EC, Croatia to Discuss Use of EU Funds Beyond 2020 Next Week

By 9 October 2019

ZAGREB, October 9, 2019 - Representatives of the European Commission and the Croatian government will meet in Zagreb next week to discuss the use of EU funds in the period from 2021 to 2027, when there will be less money available to all EU member states, it was said at the European Week of Regions and Cities conference in Brussels on Tuesday.

This will be the second such meeting after last month an informal dialogue started in anticipation of the next seven-year period financial period.

The Croatian side is expected to be led by Regional Development and EU Funds Minister Marko Pavić while the European Commission is to be represented by Aurelio Cecilio, who heads a unit in charge of Croatia, Slovenia and Bulgaria.

The Croatian government depends on money from EU funds, which account for about 80% of public investments in the country. The EC, the EU's executive body that approves financial allocations, in February this year published a report with guidelines for cohesion policy investments.

It proposed that Croatia should invest in areas such as research and development, environmental protection and digital and transport connectivity, which includes connecting Croatian islands with the mainland to improve the life of local population and stop emigration.

Croatia is yet to determine its priorities. In recent years most of the EU money has been invested in transport and agriculture, the most expensive project being the construction of the 526 million euro Pelješac Bridge. Talks held between the EC and Croatia so far indicate that there will be no more of such big and visible individual projects and that money is to be invested in a large number of smaller projects.

In the 2021-2027 period Croatia is expected to receive 6% less allocations from the EU budget than is now the case. Over the past seven years Croatia has had at its disposal 10.7 billion euro from the EU budget.

However, this is not the only piece of bad news for countries like Croatia. This week the EC has continued to insist on greater participation of local authorities in joint projects. In the period from 2014 to 2020 the EC has given a maximum 85% of the money for individual projects while the remaining 15% has been provided by local government units.

The EC now wants the share from the EU budget to be reduced to 70% and the share given by local authorities to increase to 30%. This is mostly supported by northern EU countries that pay more into the joint budget than they get from it while south-eastern countries, which take more money than they pay into the joint budget, are against it.

Their position is supported by the European Committee of the Regions, the EU's advisory body representing European regional and local authorities, but during Tuesday's European Week of Regions and Cities, the biggest annual event on the EU's cohesion policy, the EC insisted on its view that the share of local project funding should be increased, notably owing to economic recovery and GDP growth.

The final decision could be made next year, when the EU will be chaired by Croatia in the first six months, after which Germany takes over the six-month presidency.

More news about EU funds can be found in the Politics section.