[pic] | COMMISSION OF THE EUROPEAN COMMUNITIES |

Brussels, 12.9.2007

COM(2007) 507 final

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS

Strategy for the Outermost Regions: Achievements and Future Prospects

{SEC(2007) 1112}

TABLE OF CONTENTS

1. Introduction 3

2. Progress to date 4

3. The next step: grasping the opportunities of the 2004 strategy 5

3.1. Reducing the accessibility deficit and the effects of other constraints specific to the outermost regions 5

3.2. Making the outermost regions more competitive 5

3.3. Strengthening the Wider Neighbourhood Action Plan 7

3.4. Support instrument for offsetting the effects of handicaps 9

4. Future prospects 10

4.1. The challenge of climate change 10

4.2. The implications of demographic change and migration 11

4.3. Agriculture in the outermost regions 11

4.4. The role of the outermost regions in EU maritime policy 12

5. Conclusions 13

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS

Strategy for the Outermost Regions: Achievements and Future Prospects

1. INTRODUCTION

Article 299(2) of the EC Treaty and the two Communications adopted by the Commission in 2004[1] stress the need to recognise the special nature of the outermost regions (the "ORs")[2] and to put in place a genuine European strategy to support them.

There are three main strands to this strategy: to reduce the accessibility deficit and the effects of the other constraints on the OR, to make them more competitive, and to strengthen their regional integration. The strategy is founded on an active partnership between the European institutions, the Member States and the outermost regions.

The first assessment after three years of implementation is very encouraging. Many measures based on a variety of Community policies have been adopted and the economic and social situation of the ORs has improved.

The European Parliament, the European Economic and Social Committee and the Committee of the Regions approved the strategy and called on the Commission to put it into practice[3]. To this end, the Commission proposes reinforcing the 2004 strategy with new measures able to be realised in the short term.

It also intends to launch a debate on the longer-term future of the strategy, which needs to be updated and enhanced in order to address the serious issues the ORs will face in the years to come. A consultation will be organised with this in mind, culminating in a Communication in which the Commission will launch a new phase in the development of its OR strategy.

This present Communication:

- assesses the implementation of the strategy since 2004, giving a detailed description in the attached working document[4];

- puts forward short-term measures for fully implementing the 2004 strategy;

- launches a debate on the long-term implications, referring to main themes which are sensitive issues for the OR: climate change, demographic change and migration management, agriculture, and EU maritime policy.

2. PROGRESS TO DATE

The past three years have been crucial to the implementation of the European strategy for the outermost regions. All of the key instruments for the economic and social development of these regions have been redefined and revised. Examples include:

- the revised cohesion policy comprising a special financial allocation to offset the additional costs linked to the handicaps defined in Article 299(2) of the Treaty;

- specific provisions in favour of the outermost regions in the context of the reform of the sugar and banana market organisations;

- preferential treatment of the outermost regions regarding the new guidelines on national regional aid;

- a specific initiative in the Seventh Framework Programme for Research and Technological Development (FPRTD) to unlock the research potential in the outermost regions and to improve their integration into the European Research Space.

Most of the other initiatives recommended in the 2004 Communications have also been realised[5].

The many Community measures taken to support the outermost regions reflect the Commission's intention to address the features specific to the ORs when EU policies are put into practice. Moreover, the Community intervention in and for these regions shows a cross-sectoral, complementary approach, thanks above all to the concerted efforts of all Commission departments. Improved accessibility, stronger competitiveness and better regional integration remain relevant issues and an appropriate response to the development priorities of these regions. Lastly, although the strategy will help to improve the socio-economic situation in the ORs[6], the Community policies supporting them can be improved, particularly with a view to making Community action more consistent.

Some of the initiatives put forward in 2004 are still at the development stage, however, the most obvious being the efforts to incorporate the ORs in the European Research Area, and adapt Services of General Economic Interest (SGEIs) to the needs of local markets. In addition, it is important to ensure that the new possibilities aiming to improve the coordination between the ERDF and EDF are fully exploited in practice. For these reasons the strategy must now enter a phase of fruition in which all the opportunities of the 2004 strategy are harvested.

3. THE NEXT STEP: GRASPING THE OPPORTUNITIES OF THE 2004 STRATEGY

Over and above the measures adopted since 2004, the Commission intends to redouble each aspect of the strategy by taking complementary action.

3.1. Reducing the accessibility deficit and the effects of other constraints specific to the outermost regions

The following measures may move us closer to achieving this goal:

- exploiting the opportunities offered by the use of the specific allocation to offset the additional costs of transport and new information and communication technologies;

- continuing the effort to fill the broadband gap, particularly via ERDF operational programmes;

- exploiting the opportunities offered by implementing the TEN-T, TEN-E and Marco Polo II programmes;

- assessing the specific needs of the ORs when the POSEI programme implementation report is drawn up.

3.2. Making the outermost regions more competitive

Several instruments may strengthen the competitiveness of the ORs:

Cohesion policy

The poor competitiveness of the ORs calls for a special effort in the context of the cohesion policy. The operational programmes for the 2007–2013 period for both the ERDF and the ESF, the "Regions for Economic Change"[7] initiative, and technical assistance at the initiative of the Commission[8] should help to make the ORs more competitive in terms of the Lisbon strategy for growth and employment and the Community Strategic Guidelines. Steps should be taken to:

- formulate a genuine regional innovation partnership strategy[9] to be implemented above all by centres of excellence and competitiveness, and strengthen research, technological development and telecommunications infrastructures;

- help strengthen human capital by reforming education and training systems and exploiting human research and innovation potential. It should be ensured that the type of training offered be consistent with the actions planned in the main domains distinguished in the Commission's strategy for the outermost regions, namely in the areas of agriculture and environment, renewable energy, transport, telecommunication and tourism;

- increase the use of renewable energy sources (biomass including urban waste, geothermal energy, wave energy, solar power and wind power) and improve the energy balance of the ORs so as to lessen their dependence on outside sources;

- include biodiversity in development project design, particularly via measures to sustain habitats and species;

- encourage sustainable economic development by promoting measures to protect biodiversity which is often very high and a major economic asset in ORs. This will also contribute to the EUs declared objective of halting biodiversity decline by 2010;

- support modernisation and strengthen the local production base by, for example, setting up quality and environmental management systems for SMEs ("eco-innovation"), adapting the skills of workers and entrepreneurs, developing entrepreneurship and creating businesses;

- foster the competitiveness and sustainability of the tourism industry in particular through the support of a sustainable management of destinations;

- strengthen financial-engineering mechanisms and ease access to finance for SMEs and micro businesses in these regions, particularly under the Jeremie and Jessica initiatives;

- strengthen the role played by cities and towns in order to promote a flexible local economy combining industries, services, leisure and tourism via integrated urban programmes and urban initiatives in the ORs, such as those of the "Support for Cities" project URBACT;

- ease access to jobs and sustainable inclusion in the labour market for unemployed and inactive people and strengthen the social inclusion of the disadvantaged.

Framework programmes

The following Community framework programmes can be used to make OR economies more competitive:

- the recognition of the special nature of the ORs in the specific programmes of the 7th FPRTD, particularly the Capacities programme, should be fully exploited and enhanced by including the potential of these regions in certain themes of the Cooperation programme, such as energy, the natural dangers inherent in climate change, subtropical agriculture or fishing, and aquaculture;

- the Framework Programme on Innovation and Competitiveness includes some financing opportunities which are highly relevant to these regions and ought to be exploited (eco-innovation, use of information technologies, generalisation of renewable energy and energy efficiency improvement);

- the Lifelong Learning Programme[10] should stimulate exchange, cooperation and mobility between the education and training systems in the Community [11] while bearing in mind the priorities of the ORs.

Services of general economic interest

In relation to the operation of services of general economic interest in these regions, the Commission will continue to take account of regional specificities as well as of a detailed analysis of the relevant market. When the costs to provide these services are higher than the costs in other regions, their financing must be ensured in line with the provisions laid down in the applicable State aid rules, which allow for full compensation of all such costs. When drawing up the specifications for access to universal service, the Member States concerned are encouraged to take account of the special characteristics of these regions, particularly in terms of the isolation of the systems and the remoteness and fragmentation of the territory.

3.3. Strengthening the Wider Neighbourhood Action Plan

Strengthening the regional integration of the ORs in their vicinities is an innovation of the 2004 strategy which has brought noticeable improvements, but it needs to be strengthened by involving public and private local players as well as the Member States concerned. Dialogue between the regions and their neighbouring countries, particularly the ACP (Africa, Caribbean, Pacific) countries and the overseas countries and territories (OCTs)[12] associated with the EU is the tool for pushing this process forward.

There are already some potential measures for pursuing this priority:

Recognising the special nature of the ORs in Economic Partnership Agreements (EPAs)

To help exploit commercial opportunities to the full and intensify regional trade between the ACP countries and the ORs , the Commission is envisaging specific arrangements to ensure that the concerns of the ORs, as notified by the Member States, are incorporated in EPAs. These arrangements will be in line with the EPA negotiation procedures and the WTO rules, and will be geared to the specific features of each region.

They may involve any type of measure likely to accelerate the inclusion of the ORs in trade at regional level, and any needed to address the vulnerability of the OR markets and some of their products. The Commission also wishes to highlight the fact that ACP-OR commercial relations are not restricted to trade in goods; they should help to consolidate ACP-OR relations in all domains included in EPAs.

Coordination of financial instruments

On the basis of the dialogue with the ACP and the OCTs under the programme for the 10th EDF, each partner is called on to implement the specific possibilities and practicalities of a concerted EDF and ERDF programming with parallel cofinancing arrangements, with a view to cooperation schemes at national and regional level.

The Commission will examine the specific potential for coordination between the territorial cooperation programmes (ERDF) of French Guiana and the geographical programme "Brazil" financed by the Development Cooperation Instrument (DCI)[13].

Strengthening sea connections between ORs and neighbouring non-member countries

When the air transport guidelines were introduced, the common transport policy recently accepted the need to include the requirements for mobility and transport between ORs and non-member countries and OCTs, so as to reduce their isolation. This opening-up should be complemented by a similar approach to maritime transport, authorising State aid for launching transport services between these regions and neighbouring non-member countries.

Joint participation by ORs and non-member countries in research networks and Community framework programmes

The reinforcement of the RedCLARA research network via the @LIS II[14] programme and the potential and gradual inclusion of Caribbean countries in this network provide an opportunity for ORs such as Guadeloupe, French Guiana and Martinique. It will strengthen the links between these regions and the scientific communities of the neighbouring OCTs and link them with continental Europe via the Alice project, taking advantage of a cheaper, high-speed link.

When the Economic Partnership Agreements are negotiated the Commission will encourage the ACP countries and the outermost regions to engage in cooperation schemes and play a joint part in the 7th FPRDT, the Framework Programme on Innovation and Competitiveness, and the education and the Lifelong Learning Programme.

The ICT strategic support programme of the Framework Programme on Innovation and Competitiveness aims to encourage innovation and competitiveness by stimulating the wider and more effective use of ICT by citizens, public authorities and the private sector, particularly SMEs. The ORs are encouraged to make use of financing to develop or extend national, regional or local initiatives in the ICT field.

Recognising the special nature of the ORs in migration policy

Certain measures can be contemplated:

- coordinating the ERDF territorial cooperation programmes with the 10th EDF, which identifies migration as one of its new ACP-EU cooperation priorities;

- ensuring that the specific needs of the ORs are met in the "Migration and Asylum" thematic programme of the Development Cooperation and Economic Cooperation financing instrument (DCECI)[15], particularly in order to assist the efficient management of migration to these regions by both combating illegal migration and facilitating workforce mobility, and to help migrants to the ORs to support the sustainable development of their countries of origin;

- supporting, particularly via the Integration Fund[16], the measures taken by the Member States to channel regular migratory flows and integrate immigrants; facilitating the issue of visas in the ORs, particularly for the transit of entrepreneurs or trainees;

- with the help of the future European Return Fund, supporting schemes for the repatriation and, to some extent, reintegration of persons illegally resident in the ORs;

- with the help of the External Border Fund and by expanding the FRONTEX agency, backing the use of modern surveillance technology, training for border guards or infrastructure construction at border-crossing points, as an immediate response to the most pressing problems of border control and surveillance;

- consolidating the basis for the action taken in this field by studying the impact of migratory phenomena on the economic, social and territorial cohesion of the ORs. The general measures applicable to the regions most affected by migration will need to be assessed and possible changes suggested.

3.4. Support instrument for offsetting the effects of handicaps

The reform of the main Community policies grants the ORs, for the 2007-2013 period, substantial funding to offset the effects of the factors recognised by the Treaty as permanently restraining the development of these regions, in an approach more closely tailored to their specific requirements.

Although the development of the ORs does not boil down to the "additional costs" issue alone, one possible means of improving the effectiveness of measures can be found in the guidelines for estimating the quantifiable effects of specific handicaps, still to be finalised. Partnership work has continued on drawing up these guidelines, aimed at systematising the factors involved in the specific handicaps of the ORs and their effects, thereby improving the assessment of those factors. The Commission intends to formalise these results which will take the form of guidelines adopted by the College. The guidelines will not be the only basis on which to assess Community intervention, however, since the Member States may also submit alternative or complementary instruments to the Commission.

The implementation of these guidelines and of the instruments drawn up by the Member States will be subject to the availability of the data necessary for estimating the additional costs. These data are largely already available, but the collaboration of Member States in collecting them is still needed. A transitional period for implementing the guidelines and the national instruments will be needed in order to acquire the necessary statistical capacity.

4. FUTURE PROSPECTS

The outermost regions are no longer amongst the poorest regions in the enlarged EU, but still suffer from the permanent nature and the cumulative effects of the factors restraining their development. The effort to adapt the specific Community and support policies whenever necessary must therefore continue, but this must be accompanied by suitable instruments such as an improved assessment of Community policies.

The Commission intends to launch an immediate debate with its partners in order to consider the future of the European strategy for the outermost regions[17]. To this end it has identified at least four issues with serious implications for the ORs both now and in years to come. These issues, which cut across the three aspects of the 2004 strategy and are priority items on Europe's agenda[18], have assumed crucial importance for these regions.

4.1. The challenge of climate change

Combating climate change and adapting to its effects are major priorities for the ORs, considering their geographical locations and their vulnerability. The effects of climate change, such as rising sea levels, will threaten agriculture, tourism, water resources, ecosystems and biodiversity in these regions. Extreme weather conditions (hurricanes, cyclones, drought, floods) are likely to multiply and affect the three aspects of the 2004 strategy:

- Accessibility: the ORs depend exclusively on air transport for passengers. This directly affects the mobility of OR residents compared with the rest of the EU, and the mobility to and from the ORs of tourists and agents of socio-economic development.

- Competitiveness: the ORs have specific sources of renewable energy. The Azores[19] and the ongoing project on the island of El Hierro in the Canaries[20] are examples of the exploitation of endogenous resources limiting CO2 emissions.

- Regional integration: some ORs have developed cooperation mechanisms in their geographical areas with a view to monitoring natural risks and limiting their effects.

The Commission invites its partners to discuss the following questions:

What measures are needed to prevent the aim of reducing emissions from adversely affecting the accessibility, economy and citizens of the ORs? What criteria should be included to ensure that this concern is reflected in an ex-ante impact assessment?

How can we best exploit the new opportunities that the fight against climate change offers ORs by virtue of their natural assets (geothermal energy, biomass, biodiversity etc.) in order to improve their energy balance and strengthen their competitiveness, e.g. by renewable-energy development and research?

How do we achieve progress towards energy self-sufficiency by exploiting energy-saving potential to the maximum? What sectors other than building and transport are primarily concerned?

What new tools can be developed to improve natural-risk prevention systems through cooperation with neighbouring non-Member countries and OCTs?

4.2. The implications of demographic change and migration

The populations of most of the outermost regions have seen significant changes in both natural demographic trends and migratory flows which stimulate and threaten their economic and social growth in equal measure. This process has implications for land-use planning, the labour market, education and training needs, and public services.

The demographic growth rate of the French overseas departments is the highest in the EU.

In the Canary Islands, the rise in numbers of illegal migrants arriving by sea[21] is increased by the problem of illegal immigration of unaccompanied minors.

The ORs are not a homogeneous category in terms of migration policy: they have different legal statuses vis-à-vis the Schengen area and are affected to different extents by the migration phenomenon. Moreover, migration policy is still partly within the competence of the Member States, particularly where admission is concerned, with the EU coordinating and monitoring the action taken at national level.

Nevertheless, given the serious implications of migration for the ORs, the Commission wishes to discuss this matter with its partners in greater detail, focusing on the following questions:

How can we best meet the major challenges brought by heavy demographic pressure and ever-increasing emigration to the mainland?

How can we strengthen measures to enhance the integration of legal migrants in these territories both at the Community as well as at the national level?

What measures can be taken to tackle the root causes of migration to the ORs due to their geographical locations in an underdeveloped regional environment?

Is the promotion of legal/circular migration the best way of reconciling migration control measures with the economic and social development of the countries of origin?

4.3. Agriculture in the outermost regions

Agriculture is a key factor in the economy of the ORs, which are handicapped by geographical and climatic disadvantages. Agricultural production and the supply of food will remain essential for the economic sustainability of these regions, which can be further enhanced by the European rural development policy.

Community support to the various agricultural sectors, in particular after the inclusion of support to the banana sector in 2006, has now been fully integrated into the POSEI scheme. This integration permits a more coherent approach to the future development of the agricultural sector in these regions. An evaluation of the impact of these reforms on POSEI will take place in 2009 at the latest.

4.4. The role of the outermost regions in EU maritime policy

The special geographical positions of the outermost regions in the Atlantic and Indian Oceans and the Caribbean Sea give Europe a global maritime dimension and the ORs an important role to play in future EU maritime policy. The ORs played an active role in the consultation on the future maritime policy of the European Union launched by the Commission in June 2006[22] and, under the RUPMER cooperation project, supported by the INTERREG IIIC programme, submitted a joint contribution to the Green Paper "Towards a future Maritime Policy for the Union". This consultation process will culminate in a new EU maritime policy and an action plan addressing inter alia the special features of the ORs.

The ORs play an important role in the EU maritime area and give the EU its global dimension. Their existence depends upon their relationship with the sea: the variety of their maritime economic activities, the incomparable wealth of their natural marine resources, but also their vulnerability to climate change and extreme phenomena in marine areas. The size of their exclusive economic areas is equivalent to that of the Mediterranean and Baltic Seas combined, it allows them to provide important ecosystem services and turns their Member States into world leaders in terms of sea area. This also heightens the EU's responsibility for protecting maritime resources.

In some ORs the sustainable use of their marine resources will depend upon a closer cooperation with their neighbour countries. Both the strategy for the ORs and the new EU maritime policy should promote the development of cooperation mechanisms with those countries. The NET-BIOME project for networking the regional research policies of the ORs and the OCTs in tropical biodiversity, particularly marine biodiversity, demonstrates the ability of the ORs to create a research network in a domain specific to them and with potential for exploiting their assets. In fact, cooperation in the field of science and marine research is of considerable importance for the ORs and will be contribute for these regions to be able to face the challenges of climate change and their oceans' sustainability.

The Commission invites its partners to discuss the following questions:

How can we promote governance tools in the various sea basins (the Caribbean, the south-east Indian Ocean, Macaronesia)? Would a conference per basin bringing together the interested parties to formulate a coordinated approach to the issues in question be a step in the right direction?

How can we support the specialisation of the ORs in certain RTD segments such as blue technologies, e.g. by improving information and communications in this domain?

How can we exploit the economic activities linked to their maritime environment, such as fishing, aquaculture, transport, sustainable tourism and renewable energy?

How can we keep up the fight against illegal fishing, continue ocean surveillance and risk management, enhance maritime safety and preserve the marine environment?

How can the ORs, based on their maritime potential, contribute to Europe's sustainable development as a whole, through the new maritime policy?

How can we ensure sustainable coastal zone management in Outermost Regions?[23]

5. CONCLUSIONS

By taking action to maintain and develop the strategy for the outermost regions, the Commission has fulfilled its obligations in all fields of Community intervention, combining financial support with the adoption of specific measures. The strategy has exploited not only the partnership with the three Member States and the seven ORs, but also the guidelines set out by the other European institutions.

While giving a positive assessment of the first implementation phase of the OR strategy, the Communication stresses the need to intensify the aspects of the 2004 strategy by adopting additional measures for the 2007-2013 period. It also constitutes the ideal basis for considering the future of the OR strategy, focusing on climate change, migration management, agriculture and EU maritime policy, which have far-reaching implications for the socio-economic development of these regions.

This Communication launches a debate with the European Institutions, the Member States and, within the outermost regions, the regional and local authorities, socio-economic players, the research sector and academic circles. It is suggested that the consultation phase will last until March 2008. During this period the Commission will organise, in partnership with the regions and Member States concerned, seminars and workshops to discuss the following questions:

- To what extent can the 2004 strategy be adapted to the new challenges facing the ORs?

- What would be the most appropriate ways to tackle the major demographic differences and migratory flows between the ORs and neighbouring regions or countries?

- Is climate change a special challenge to the ORs?

- What actions can the ORs pursue, under European maritime policy, in order to both benefit from it and to be able to contribute to Europe's sustainable development?

After the closure of the public consultation the Commission will prepare its proposal on the future of the partnership with the outermost regions. It will launch a new phase in the development of the European strategy for the outermost regions.

[1] COM(2004) 343 ; COM(2004) 543.

[2] The ORs (the Azores, Madeira, the Canary Islands and the four French overseas departments) face specific problems listed in the Treaty: remoteness, insularity, small size, difficult topography and climate, and economic dependence on a few products.

[3] European Parliament Resolution of 28 September 2005 on a stronger partnership for the outermost regions – A60246/2005 - OJ C 227 E, 21.9.2006, p. 110.

[4] SEC(2007) 1112.

[5] An exhaustive assessment of the 2004 strategy – legislative and non-legislative acts – is given in the working document attached to this Communication.

[6] Cf. p. 20 of the working document mentioned above.

[7] http://ec.europa.eu/regional_policy/cooperation/interregional/ecochange/index_en.cfm

[8] Article 45 of Regulation (EC) No 1083/2006.

[9] The experience gained with the Regional Innovation Strategies, the Regional Information-Society Initiatives (1994–1999) and the Regional Programmes of Innovative Actions (PRAI, 2000–2006) cofinanced by the ERDF should be exploited here. These programmes enabled six ORs to try out new ideas and approaches tailored to their respective situations and designed and implemented in partnership with key regional players.

[10] Decision No 1720/2006/EC of the European Parliament and of the Council of 15 November 2006 establishing an action programme in the field of lifelong learning - OJ L 327, 24.11.2006, p. 45.

[11] Where the participation of the ORs is concerned, the application of the minimum mobility requirements for access to sectoral subprogrammes such as Comenius or Grundvig is more flexible than for other regions of the European Union.

[12] See List of OCTs in Annex II of the EC Treaty.

[13] Article 18(3) of Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation - OJ L 378, 27.12.2006, p. 41.

[14] redCLARA network website: www.redclara.net

[15] Article 18(3) of the IFCD Regulation.

[16] Only ORs in the Schengen area (the Azores, Madeira and the Canary Islands) may be beneficiaries of the FRONTEX agency's funds for external border management, return operations, integration and technical assistance.

[17] Without prejudging the result of the EU budget revision.

[18] European Council conclusions of 8 and 9 March 2007; Commission Communication on the Annual Policy Strategy for 2008 - COM(2007) 65.

[19] On the Azores, 35% of local energy consumption is covered by renewable energy sources.

[20] The "El Hierro Renewable" project aims at achieving energy self-sufficiency for the island through renewable energy.

[21] The Spanish government recorded 4 751 arrivals by sea of illegal migrants in the Canaries in 2005, and 31 245 in 2006.

[22] Green Paper "Towards a future maritime policy for the Union: A European vision for the oceans and the seas" - COM(2006) 275.

[23] European Parliament and Council Recommendation concerning the implementation of Integrated Coastal Zone Management of 30 May 2002 - OJ L 148, 6.6.2002, p. 24; ii) Commission Communication - Report to the European Parliament and the Council: an evaluation of Integrated Coastal Zone Management in Europe - COM(2007) 308, 7.6.2007.