Feb 10, 2004 - 110. Luxembourg. LU. 1. 1. 1. Netherlands. NL. 4. 12. 40. Portugal. PT. 3. 7 ..... remember the construction of the new Maria Valeria bridge ...... After the Second World War, cross-border cooperation at regional and local ...... European Border Regions (AEBR), www.aebr.net, AGEG-Flyer_en.pdf, download:.
Zsuzsanna
Bacsi – Ernı Kovács
DEVELOPMENT FEATURES OF CROSS-BORDER REGIONS
Written within the framework of the INTERREG project No. SLO/HU/CRO-4012-106/2004/01/HU-74 Keszthely, 2007
The project has been implemented within the Slovenia-Hungary-Croatia Neighbourhood Programme, co-financed by the European Union and the Republic of Hungary. The authors of the book are solely responsible for its contents. The present document does not necessarily represent the opinion of the European Union.
Development features of cross border regions Zsuzsanna Bacsi and Ernı Kovács Keszthely, 2007 The book is the English translation of the following Hungarian book: Bacsi Zsuzsanna – Kovács Ernı: Határrégiók fejlıdésének sajátosságai Keszthely-Hévíz Kistérségi Többcélú Társulás - Nyugat-Balatoni Társadalomtudományi Kutatómőhely, Keszthely, 2007
Translated by: Zsuzsanna Bacsi and Judit Bacsi
Reviewer: Ferenc Zemankovics
ISBN-978-963-9639-17-1
Published by: Multifunctional Association of Keszthely-Hévíz Microregion - West Transdanubia Social Sciences Research Group, Keszthely, Hungary, 2007 The publication was funded by the INTERREG project No. SLO/HU/CRO-4012106/2004/01/HU-74, co-financed by the European Union and the Republic of Hungary.
© INTERREG project No. SLO/HU/CRO-4012-106/2004/01/HU-74
All rights reserved. No part of this publication may be reproduced in any form or by any means, electronic, mechanical, photocopying or otherwise, without the prior written permission of the authors and the owner of the copyright. To achieve written permission for photocopying please contact: Zsuzsanna Bacsi , Keszthely, Deák F. u, 16.
CONTENTS Introduction
............................................................................................................... 1
Chapter 1 - Regions, regionalism and regional development....................................... 3 1.1 Basic concepts of regional economics, the reasons for regional disparities, theoretical models of regional development ......................................................................................3 1.1.1 Theories of regional development...........................................................................8 1.1.2 Neoclassical development theories.........................................................................9 1.1.3 Polarization theories.............................................................................................13 1.1 4 From centre-periphery theory to dependence.......................................................14 1.1.5 The export base theory.........................................................................................16 1.2 Regional differences in the factors of production, regional competitiveness .................17 1.2.1 Local and transferable goods, spatial scarcity: ...................................................18 1.2.2 Natural resources .................................................................................................19 1.2.3 Labour ..................................................................................................................19 1.2.4 Capital goods .......................................................................................................27 1.2.5 The relationships of various factors of production ...............................................30 1.3 Characteristics and determining factors of the development and growth of a region .....31 1.3.1 Aspects of regional development..........................................................................31 1.3.2 The four key questions of regional development ..................................................32 1.4 Regional competitiveness ................................................................................................36 1.5 Indicators for assessing and comparing the development of regions..............................39 1.5.1 Development Potential Indicators recommended by the EU ................................40 1.5.2 Indicators for assessing regional differences and changes ................................42 Chapter 2 - Borderline Location and Cross-Border Cooperation ................................ 48 2.1 The emergence of regionalism, the borderline concept, transboundary cooperation in the European policy.......................................................................................................48 2.1.1 Regions in the EU, the history of European regional policy, regional development disparities.............................................................................................................48 2.1.1.1 The regional structure of Europe .................................................................48 2.1.1.2 Regional policy in the EU ............................................................................52 2.1.1.3 The system of territorial classification for regions in the EU .......................62 2.1.1.4 Results of the regional policy of the European Union..................................65 2.2 Problems of borderline location, its natural and social features ....................................69 2.2.1 Borderline research, multidisciplinary border sciences .......................................69 2.2.1.1 Border areas, border cultures in Europe .....................................................70 2.2.1.2 The impact of the changed functions of national boundaries on the territorial processes ........................................................................................71 2.2.1.3 Factors influencing the character of the border and the cross-border interactions in Europe.....................................................................................73 2.2.2 Regions of specific conditions, borderline location and peripheral character......78 2.2.3 The actors of transboundary regionalism ...........................................................83 2.3 Interregional and transboundary cooperation in the EU ...............................................86 2.3.1 The forms of transboundary cooperation in Europe .............................................86 2.3.2. Borderline developments in the neighbouring countries of Europe .....................96 2.3.3 Borderline processes in Central and Eastern Europe .........................................97 2.4 Working Communities and Euroregions – Examples.................................................. 104 2.4.1 The Alpine-Adriatic Working Community........................................................... 104 2.4.2 West-Pannonia Euroregion ............................................................................... 108 2.4.3 The Carpathian Euroregion and the Duna-Körös-Maros-Tisza Euroregion ....... 110 2.4.4 Mini-regions and other levels of cooperation ..................................................... 113 Chapter 3
- Peripheral regions, and cross-border cooperation programmes in Hungary ............................................................................................. 115 3.1 The development of borderline regions before and during the transition..................... 115
i
3.1.1 Geographical position of Hungary within Europe.............................................. 115 3.1.2 Borders before the transition....................................................................... 117 3.1.3 The problems of transition in the border regions............................................... 120 3.2 Cross-border cooperation programmes in Hungary in the last ten years ................... 123 3.2.1 Cross-border programmes between 1995 and 2003......................................... 123 3.2.2 Neighbourhood programmes in 2004-2006 ...................................................... 124 3.2.2.1 The Hungary-Slovakia-Ukraine Neighbourhood Programme 2004-2006 . 124 3.2.2.2 Austria – Hungary INTERREG IIIA Community Initiative Programme ..... 125 3.2.2.3 Neighbourhood Programme Slovenia – Hungary – Croatia....................... 126 3.2.2.4 Hungary - Romania and Hungary - Serbia & Montenegro Cross-Border Cooperation Programme .............................................................................. 127 3.2.2.5 Community Initiative INTERREG IIIB CADSES programme...................... 128 3.2.2.6 The INTERREG IIIC Programme................................................................ 130 3.2.3 New programmes within the framework of the European Territorial Cooperation Objective, 2007-2013......................................................................................... 131 3.3 Problems, achievements and further opportunities of cross-border cooperation by the Hungarian borderlines................................................................................................ 133 3.3.1 The cross-border relationships and achievements of Hungarian regions, future opportunities ...................................................................................................... 133 3.3.1.1 North-East Alföld (Great Plain) borderline ................................................ 133 3.3.1.2. Northern Hungary ................................................................................... 138 3.3.1.3 The Southern Great Plain borderline area ................................................ 144 3.3.1.4 Southern-Transdanubia, the Austrian-Slovenian-Croatian borderline .... 151 3.3.1.5 Cross-border activities of Western Transdanubia .................................... 156 Chapter 4 - The Croatian – Hungarian borderline................................................... 163 4.1 The area and population of the Croatian – Hungarian borderline.............................. 163 4.1.1 The description, characteristics of the border region......................................... 165 4.1.2 Demography and population dynamics............................................................ 166 4.2. Economy ....................................................................................................................... 167 4.2.1 GDP per capita................................................................................................... 167 4.2.2 Number of enterprises ...................................................................................... 168 4.2.3 Labour market dynamics .................................................................................. 169 4.2.4 Infrastructure and development possibilities .................................................... 170 4.2.5 Environment ...................................................................................................... 172 4.2.6 The educational sector ...................................................................................... 173 4.3 The rural and spatial development experiences of borderline counties and microregions in Hungary from the transition to the present ............................................................ 174 4.3.1 The institutionalisation of rural development in Hungary, its measures and the accession of Hungary to the EU......................................................................... 174 4.3.2 Rural development experiences in the south-western borderline counties....... 177 4.3.2.1 Rural society and economy in Baranya, Somogy and Zala counties ....... 177 4.3.2.2 The results of SAPARD in the three counties............................................ 180 4.3.2.3 The results of AVOP in the three counties (2004-2005)............................ 182 4.3.3 Rural development achievements in the microregions of Barcs, Siklós and Keszthely-Hévíz ................................................................................................. 184 4.3.3.1 Rural development programmes implemented in the Barcs microregion . 185 4.3.3.2 Rural development programmes implemented in the Siklós microregion . 186 4.3.3.3 Rural development programmes implemented in the Keszthely-Hévíz microregion .................................................................................................. 190 4.4 Rural and spatial development institutions in the Croatian borderline, historical development from the transition to the present .......................................................... 192 4.4.1 Rural development and the SAPARD in Croatia ................................................ 192 4.4.1.1 Description of rural areas......................................................................... 192 4.4.1.2 Disparity analysis .................................................................................... 194 4.4.1.3 Agricultural and Rural Policy.................................................................... 198 4.4.2 The first experiences of rural development in Croatia ....................................... 203 Chapter 5 - The preconditions of successful cooperation for development in the Croatian-Hungarian borderline areas................................................ 210
ii
5.1 The resources of the Croatian-Hungarian borderline area, general situation analysis ................................................................................................................................... 210 5.2 Cooperation possibilities and priorities ......................................................................... 214 5.2.1 Tourism ............................................................................................................. 214 5.2.2 Cultural, professional and scientific connections with the Hungarian side ...... 215 5.2.3 The priorities of development in the region ....................................................... 216 5.3 The findings of questionnaires and interviews in the Croatian-Hungarian borderline region.......................................................................................................................... 217 5.3.1 The characteristics of the sample...................................................................... 217 5.3.2 The most important problems of the respondents in Croatia and Hungary ...... 218 5.3.3 The activities of respondents in applying for project funding............................ 219 5.3.4 The main problems of the rural areas in Hungary and Croatia in the borderline counties – findings of the questionnaires .......................................................... 222 5.3.5 Cross-border relationships and their importance.............................................. 224 5.3.6 Rural development projects, opinions on the information about the applications .......................................................................................................................... 225 5.3.7 Difficulties of the application procedure ............................................................ 226 5.3.8. Summary.......................................................................................................... 228 5.4 Possibilities of cooperation and development................................................................ 231 References
........................................................................................................... 237
iii
Introduction In January 2006 the Keszthely-Hévíz Microregion Multifunctional and Development Association together with the Georgikon Faculty of Agriculture Keszthely of the University of Pannonia, and the Križevci Agricultural College (Croatia) started a cooperation project within the framework of the INTERREG IIIA Slovenia-Hungary-Croatia Neighbourhood Programme of the European Union under the title „Development features of cross-border regions” (project number: SLO/HU/CRO-4012-106/2004/01/HU-74). In this project the Croatian-Hungarian borderline area is assessed, as a case study to identify the cooperation possibilities mutually beneficial for the actors of the economy in both sides of the border. Within the project the socio-economic situation is surveyed using questionnaires and interviews as primary information sources, to find out the requirements for successful cooperation, and then, based on the findings of this survey a teaching programme of 30 contact hours has been developed to train professionals for working in borderline regions, preparing them for the specific problems of such regions, and specific opportunities that such regions may offer for development, and providing skills and knowledge that may be efficiently utilised in designing spatial development plans and implementing them in practice. The present textbook contains the basic teaching material for this 30 hour training programme. The book is supplemented by a series of PowerPoint presentations to assist the application of the present teaching material in everyday classroom conditions. In the autumn of 2006 and in the spring of 2007 pilot teaching courses were run in Keszthely, at the Georgikon Faculty of Agriculture of the University of Pannonia, for undergraduate students and at the same time a short intensive pilot course of 5 days was also run for practitioners working in various areas of rural development. The experiences gained teaching the material in these courses have been incorporated into the present book. The main objective of the present teaching material is to train professionals for working efficiently in a rural environment assisting in the maintenance and development of the economic, socio-cultural, and enviromental functions of a rural region, to deepen and widen the knowledge of professionals finding employment in the development of borderline regions, being capable of analysing the specific situation arising from the borderline location, and of identifying and utilising the particular opportunities linked to this situation, as well as coping with the particular drawbacks of this position. The teaching material puts particular emphasis on the presentation of the support programmes and funding the European Union offers for such regions, and of the experiences of successful examples of cross-border cooperation, attempting the adaptation of these experiences to the example of the Coratian-Hungarian borderline area, as the case study area of the present project. The structure of the textbook is the following: The first chapter summarises the basic concepts of regional economics – or at least the key concepts needed for the assessment of the borderline regions. Naturally, the basics of regional economics can ne found in many 1
excellent texbooks and publications, both in English and in Hungarian, but it seemed reasonable to summarise here briefly the basic concepts that will be used in the following discussions, so that the student can use the textbook as a whole compact unit. In this chapter the main factors of regional development, growth and competitiveness will be covered, the most important models of regional development, the approaches of these models to the convergence of the development levels of regions, the possible role and significance of government intervention attempting to enhance regional convergence and decrease regional disparities. In the final section of the first chapter the main indicators will be presented that can be used for describing and analysing the development levels of regions and comparing spatial differences. In Chapter 2 the question of borderline location is discussed in detail. The concept of borderline location, the specific features, problems and opportunities arising from the borderline situation and the theoretical approach of assessing the importance of these features will be introduced. Then the history and evolution of borderline cooperation will be described as it is considered in the regional policy of the European Union, the measures and resources the EU provides for assisting transboundary cooperation, and the main project types and their experiences presented. Chapter 3 describes the development of borderline regions in Hungary after the transition of 1990, with special attention to the results and experiences of the past 16 years regarding cross-border cooperation. Chapter 4 focuses on the counties of Croatia situated by the Hungarian border, describing the natural and socio-economic features of these areas, and showing the recent rural development processes of Croatia with respect to the country’s future accession to the EU. Chapter 5 summarises the cooperation possibilities and the development opportunities of the borderline counties of Croatia and Hungary, relying on the results of the survey carried out within the framework of the present project in the spring of 2006. In writing the book the authors express their gratitude to the people involved in the activities of the mentioned INTERREG project. Special thanks are due to Judit Bacsi, Dóra Veronika Cservenka, dr. Zsuzsanna Lıke, for their help in arranging the source material into a complete book, in organising the chapters and also teaching the material in the mentioned pilot courses. We are particularly grateful for the help by professor Renata Husinec, Sandra Kantar, Kristina Svržnjak and Dejan Marencić, the experts of the Agricultural College Križevci (Croatia) for their assistance regarding the material about the border regions in Croatia. Naturally, the full responsibility for any mistakes and faults of the book remain with the authors. Keszthely, 10 February, 2007. Zsuzsanna Bacsi and Ernı Kovács
2
Chapter 1 - Regions, regionalism and regional development 1.1 Basic concepts of regional economics, the reasons for regional disparities, theoretical models of regional development Since the middle of the 20th century space, as a dimension of analysis, has received increasing importance in social and economic research. Many excellent studies, and even textbooks have been written describing and assessing the role of space and location in the evolution of social and economic processes. Regional science was born, together with its tools and research methodology – and this research methodology has grown and expanded ever since. Some examples of the best textbooks recently published are Lengyel (2000, 2003), Rechnitzer (1998, 2001), LengyelRechnitzer (2004), Nemes Nagy (1998) , Illés (1983), Horváth (1998a) HooverGiarratani (1999), Krugman (1995). In spatial research the region is the basic unit to which research is focused, and this unit has been generally used not only in research, but also in political-strategic decision making. The European Union, in its NUTS scheme (Nomenclature des Unités Territoriales Statistic, Eurostat 2002) created a hierarchic classification system for the various spatial units, and these spatial units are the targeted areas for various programmes and measures of its common policies. The present book does not intend to give a detailed coverage for regional economics. It would be unnecessary, as the reader can find all the information in great depth in the books mentioned above. However, to facilitate the easier understanding, and the application of the book as a compact teaching resource in itself, the following sections give a brief summary of the most important terms and concepts of regional economics, that will be necessary to understand the following chapters discussing and analysing the development of borderline regions. The concept of the region: There is no unique, generally accepted and overall definition for the concept of the region. The identification of the region as a territorial unit varies according to the purpose and approach it is used for, several definitions exist, for which the justification is the focus of research based on these definitions. The definition may be based on natural or geographical features, on ideological factors (cultural, linguistic or civilisational features), economic characteristics and political-legal-administrative viewpoints ([LengyelRechnitzer, 2004). 3
Hoover gave the following funny description of the region „the region is a spatial unit for the analysis of which regional scientists receive research grants” (Hoover-Giarratani, 1999). A considerably flexible and widely accepted definition is given by Georges Benko (1999): „The region is a territorial entity, which facilitates the description of human and natural phenomena, assessment of social and economic data, and application of a common policy. The region is characterised by homogeneity, functionality, integration, solidarity and interaction with other regions. ” Nowadays, relying on the above wide definition, three types of the region are defined (Lengyel-Rechnitzer, 2004): •
•
•
homogeneous region: the whole area has very similar natural, social or economic characteristics, it has a unified image (an agricultural area, without a centre, as an example). There are less interactions within such a region, and the settlements inside the region have less contact to each other than to settlements outside the region, that is, trade and commerce is less intensive inside the region, than between the region and other regions. nodal region: the space is a space of power, the economic activities are concentrated to certain dense points, that is, it contains a big city as the nodal point of the space and its space of attraction, that is, the surrounding smaller settlements. The concept was created in the study of settlement networks. The region is characterised by functional relationships, and these relationships are stronger between the centre and the other settlements within the region, than between any settlement of the region and other regions, or settlements in other regions. planning or programming region: this concept describes the administrative structure of a country, and defines territorial units for the spatial planning, and statistical information collection (e.g. counties, NUTS II regions, and higher levels of the NUTS hierarchy used in the EU – of which the preferred levels are NUTS II and NUTS III for the common policy measures). This region may be an administrative territorial unit in its own right, or may be an informal functional territorial entity without an independent administrative organisation.
The idea of the region may be applied for supranational units, above the nation state, that is, for geographical groupings of neighbouring states, regional integrations (e.g. EU, OPEC, EFTA, and these are called macroregions (or supranational regions – thus three large territorial units are identified in world economics, namely the USA, the EU and Japan with the Far East, including their zones of attraction, too). A region may also be the area of neighbouring settlements, a contiguous area within a country, which is called subnational region. Within subnational regions the elements are the settlements (or within settlements the districts, town zones) that is, the local level, comprised of the so-called microspaces (which may be the 4
microeconomic decision making units, namely the family, the employer and the employee). A specific transitionary level between supranational and subnational levels is the level of transnational regions, which are the areas covering subnational units of different (neighbouring) countries, over the border of the nation states (Lengyel-Rechnitzer, 2004). Among the many exciting areas of regional economics the present text focuses on the spatial inequalities in the social traits of the regions, that is, on the characteristics, causes, temporal dynamics of the inequalities of regional social characteristics, and on the possibilities of modifying (diminishing) these inequalities. The centre-periphery models will be discussed as relevant theoretical models here, which explain the difference between the developed regions and the underdeveloped, peripheral areas. Besides the comparison and assessment of the regions and their disparities a similarly important question is the assessment of difference within the region, that is, the characteristics, differences and inequalities of the units (actors) of the region. Regional economics gives three causes for the inequalities of regions: • advantages caused by availability of production factors, and mainly natural resources – which is based on the imperfect mobility of the factors of production, namely the fact that some inouts are spatially locked and cannot be moved. • The profitability of spatial concentration – as production resources cannot be perfectly divided, some resources can be moved in only larger units to the place of utilisation, which creates economies of scale, and favours the utilisation of larger volumes in the same place. • Costs of transport and communication – as goods and services are not perfectly mobile, the spatial location highly influences the access to and availability of commodities and services, and thus the profits and costs arising. In this sense it can be stated that the differences in the resources of economic space are explained by two types of causes, namely the differences of natural resource availability, and the impacts of economic activity (the actual economic processes and interactions). Location theory, one of the main research areas of regional economics deals with the problem of the way the decision maker (the company, enterprise, consumer, employee, or public institution) assesses the characteristics of the economic space in choosing its location. Thus one of the main factors influencing the structure of space is the availability, or accessibility of resources. The most important issues here are the following: - Transport facilities, road network, influencing transportation costs. - The size of the town/settlement, which determines the size of the available markets, the the market competition, and the availability of inputs (materials of input services) needed for production. - Labour costs, qualifications and mobility of labour. 5
The above aspects define for the producer / service provider / business enterprise the basic framework for accessing inputs and taking outputs to the markets, and for the households these define the selection and price levels of the available commodities, and the available job opportunities and wage levels for the employee. Good location is a basic factor of selecting the place of activity for the decision maker. A key element of good location is the quality of transport facilities, and another aspect is the destinations these facilities lead, that is, the resources or markets made available by these transport facilities. For the assessment of the location and its spatial linkages several indicators are known from the relevant literature (Nemes Nagy, 2005). The so-called simple indicators describe the state of the transport infrastructure: - Length of motorways in km within the settlement of spatial unit, - Number of railway stations, - The time needed for reaching the nearest centre. The composite indicators assess the joint impact of several (usually two) factors, e.g.: - the „value” of possibilities available in a location (node, centre, measured by e.g. the size of the accessible market, the purchasing power of the population, etc.), - the „cost” of accessing the above centre/location/node from the decision maker’s place of activity (this cost may be measured in time, distance or money). An example for the composite index is the accessibility index, which is directly proportional to the „values” of the available nodes and inversely proportional with the „costs” of accessing these nodes (Wegener et al., 2002). The accessibility index is often computed with regard to a chosen important city or territorial unit, using the distances to e.g. the capital of the country, or to the central town of a particular region, microregion, to the nearest border crossing, or motorway entrance (Nemes Nagy, 2005). The concept of peripheral locations is a concept related to accessibility. Peripherality cannot be easily defined even if the attention is focused only on the economic aspects of the concept. Most of the approaches mention two factors defining peripherality: • the increased transport costs for raw materials, outputs for sale, and generally of access to markets – due to the large distances to be covered, both for business enterprises and for households. • The lack of agglomeration advantages typical for densely populated areas having dense business networks. The indicators of peripherality usually wish to draw the geographic-territorial patterns of the above disadvantageous features, and the majority of these indicators focuses on one of the two elements, more or less neglecting the other (Copus, 1997; Copus 1999). 6
Peripherality indicators can be classified into the following two groups: The first group uses the methodology of the gravitation model (HooverGiarratani, 1999) measuring the so-called „economic” or „market” potential. This assumes that the potential economic activity depends, in any area/location, on the vicinity of economic centres (the distance to these centres) and the „economic size or volume” of these centres. Thus the impact of such a centre grows with increasing economic activity of the centre, and decreases with the increasing distance of the location to the centre. The total economic potential of the assessed location is the sum of its potentials to the accessible economic centres. By computing these indicators a map can be created of the space, which measures and emphasises the economic advantages of agglomerations, and results in steeper gradients in the vicinity of the „core areas”, territorial centres, than the gradients computed simply by travel costs only. The second group of indicators contains the indices of „travel time or travel cost”, or the index of „daily accessibility”. Although this approach is easier and more intuitive than the first group of indicators, it has become the dominant approach for the last few years, mainly due to the availability and wide spreading of the modern GIS software, which made the calculation of distances has become much easier than before. These indicators are generally used for answering the following three questions: -
-
What is the total travel cost needed for reaching all the main business centres of a selected region? How many people can be reached from any point (location) on the map limiting the total travel time to a daily travel, that is, to not more than 3 to 4 hours one way, and the same for the return trip? What is the total cost for reaching a market of a particular size (say, n consumers) from a particular location?
The smaller the value of the peripherality index (that is, the closer it is to 0) the closer is the potential of the assessed unit to the highest potential of the whole region, indicating a less peripheral location of the unit within the region. The following map gives the economic potential and the standardised peripherality indices of Europe computed by the GPD levels in ECU for the year 1996, using NUTS III level regions as territorial units. In the above approach the value of peripherality significantly depends on the way the distance is measured between the territorial units. It must be remembered, that the distance should not be the lenght of a straight line drawn between the two points, but the distance by the transportation network (roads, railways). The consideration of various transport modes may result in different index values, so accessibility by road, railway or water can be assessed, for which the travel costs (in money or time) may differ considerably. Copus and Loughry (2002) give detailed comparisons of these accessibility results. 7
Figure 1.1: Economic potential and periheriality in Europe. Source: Copus and Loughry, 2002.
1.1.1 Theories of regional development The summary given in the following section is based on the study by the European Commission (2003) and on the book by Lengyel and Rechnitzer (2004). The development theories attempt to explain the changes of economic and social processes observed in the real world, and they are often used as theoretical foundations for the measures of economic and social policy. This is the case of the polarization theory, first carried out with precision by Perroux in 1950 with further future developments by himself and other colleagues. This approach inspired and theoretically sustained polarized development strategies that were tested in Spain and Latin America in the 60s and the first half of the 70s. In this example, theory has gone ahead of regional policy. In the opposite sense, certain doctrinal approaches have come about after trying to explain existing situations and the underlying policies of certain empirical realities. This is the case for the dependence or centre-periphery theory that arose as a theoretical drawing-up to explain relations between development and underdevelopment. That is, in this case, the observing of facts helped to develop a theory. It is more difficult in other cases to know which one came first, perhaps because neither of them, theory nor practice, tried to get ahead, but found 8
themselves mid-way instead. For example, the neoclassical understanding, which has had broad repercussions and influences in certain times and places, did not arise to deny the need of regional politics. However, it is unquestionable to say that the supporters of giving prominence to the market to solve economic problems can and usually do rely on the laissez faire way of thinking to justify their inhibition when applying policies that tend to correct regional imbalances. Thus two main schools of thought can be distinguished regarding the explanation and management of regional disparities, by their approach to convergence and divergence and the relevance of practical measures and intervention possibilities. At one end, the neoclassical model stands out. Its most important conclusion is that the market promotes regional convergence, without any need of public political interventions and perhaps with the condition that these interventions do not happen, making the territorial system evolve towards the disappearance of regional disparities. At the other end, it is thought that market forces generate dynamics that, far from making regional imbalances evolve towards their disappearance, they tend to accentuate them and to become deeper, in an accumulative process of income and wealth concentration in the more developed regions. Other intermediate approaches exist, based on the supposition that regional economies are going through a series of phases in their historical process of development, each of which marks an overcoming of the previous situation. Several theories state that a relation exists between the evolution of regional disparities and the running of the economic cycle (e.g. recession that followed the oil crises). More radical schools deny the capitalist system’s ability to promote regional convergence, given its nature and essence, not even with policies to strengthen economic, social and territorial cohesion. The argument of theories about convergence and divergence, explaining the evolution of regional imbalances gained a new impulse in the mid-80s triggered by the reform of the European Union Structural Funds. The main argument for a reform of the Structural Funds was the growing regional inequalities and the need for political intervention. In the following section three examples are shown to illustrate the typical theoretical approaches to development, namely the neoclassical model, the centre-periphery model and the export base theory.
1.1.2 Neoclassical development theories The neoclassical model, in a simple formulation can be summarised in the following terms: if an imbalance occurs in a point of a system (economic, social, etc.), the system itself automatically develops neutralizing actions for the dynamics unleashed, starting a force generating mechanism that tends to restore equilibrium, an equilibrium that can be on a different point than that where it started. It is the belief in the ability of the capitalist system to automatically correct the imbalances that occur within it on its own that gives rise to the theory. On the other hand, any exogenous interference or 9
intervention on the market will, in all probability, increase the imbalancing trends instead of counteracting them. That is why there is nothing better than leaving the market forces to shorten and cancel regional imbalances, instead of applying policies and financial resources that could make the situation worse. The close predecessor of the neoclassical approach on the evolution of regional imbalances can be found in the application of the international trade theory in the interregional field. The fundamental supposition in a first formulation is that the goods produced move freely between regions whilst the productive factors remain still. The mobility of these factors is accepted in a reviewed version. According to Ohlin (1933, 1961, 1967), each region specializes in the production of those goods for which it is better suited as a consequence of the different distribution of factors, and therefore regional price differences arise for a given good, as a function of the particular combination and cost of factors in each case. It is natural for interregional trade to arise in these conditions, that under certain unrealistic suppositions, will lead to an interregional levelling of prices for each good and to certain regional specialization. What will happen is that a region will produce less amount of those products with a greater content of the factor which is scarce in its field and, on the contrary, it will be able to export intensive goods with the most abundant factor in it. However, the decreasing demand of the scarce factor will reduce the relative scarcity and will decrease prices; in the other hand, the greater demand of the relatively abundant factor will increase prices. An equilibrium situation will be reached in this way, with a levelling of product prices, by substituting interregional movement of productive factors with movement of goods by means of trade between regions. The resulting equilibrium will balance the prices of both the outputs and the inputs of production, and this way leads to the convergence of regional incomes and regional development. The neoclassical model considers the labour and capital the productive factors. Let us convene that the function of production for each good and region are identical, linear and homogeneous; that the participation of each factor in the product is constant, independent of price; that perfect competence exists; that transport costs are zero and that regions reach total productive specialization in the goods for which they have comparative advantages. Let us discard the possibility of increasing economies of scale, segmentation of the labour market, migration costs of labour force and capital transfer. Lastly, let us suppose that workers only move due to salary differences and that capital only seeks a greater profitability. Under the previous hypotheses, workers will emigrate towards the more developed regions, stopping the increasing salary trends and liberating the underdeveloped regions of invisible employment and underemployment. Capital will encounter increasing difficulties in urban and industrial areas due to the elevated labour force costs, labour disputes, the greater competition between businesses, the bottleneck produced by agglomeration diseconomies and the disappearance of investment opportunities. Capital will move towards the underdeveloped areas in view of the greater profits expected in them since they do not show the obstacles described. This capital will benefit, with new investments, from job creation and the consequent generation of income. As a consequence, according to the 10
neoclassical model, the movement of productive factors leads, in time, to the convergence in income levels and in development of the different regions within a nation. Reality, however, does not confirm the expectations that arise from the deductive model described. It is true to say that some of the suppositions are less unacceptable on an interregional level than on an international level. Nonetheless, they still show weak points. As a general objection, a first group of criticisms states that this is a comparative statical model that forgets the dynamic aspects of reality. Following Solow’s steps (Solow, 1956), the model can be improved incorporating the impacts of technological development. However, the consequences of the following are not taken into account: depletion of resources, changes in the proportion of factors used, variations on the roles of production and demand, generation and dissemination processes of innovations that either reinforce or weaken the existing territorial structure, demography dynamics, etc. The second group of criticisms is centred around the lack of correspondence between the starting suppositions and reality. Migration, for example, may have cumulative and not balancing effects; labour force is not homogeneous, but it has various degrees of specialization instead; information on working conditions is deficient or incorrect; salary differences are not the only inducing factor on labour force mobility, other variables have to be taken into account, levels of unemployment, distance covered, family circumstances or attachment to one’s place of origin; transfer costs, both for work and capital, are not zero; the less organized the capital market is, the less efficient it is; cumulative capital, equipment, infrastructures and allocation stocks condition and attract new investments; agglomeration economies and proximity to consumer markets are an incentive for entrepreneurs; entrepreneurial risk and uncertainty is higher in underdeveloped regions, etc. Lastly, even when accepting the neoclassical theory and its effects on regional convergence as a trend the system gets close to but never quite gets there, we must add that it does not imply levelling of incomes per person in the different regions. There are a number of factors relative to regional differences that oppose this: the relative weight of property income, the proportion of active and busy population relative to total population, degrees of specialization and professional qualifications, and others. Richardson (1969) concludes after critically analysing the model that “structural inflexibility, the strong tendency towards concentration and the appearance of sporadic imbalancing forces makes the supposed existence of automatically correcting factors of imbalances lead us to more than one mistake”. For some observers, the creation of the ERDF (1975) then, European Economic Community and the reform of Structural Funds shows little faith in the market’s correcting abilities. The neoclassical approach was reborn in the form of endogeneous growth theory at the beginning of the nineties as an intellectual reaction to the rise of reinforcing policies of economic and social cohesion. Studies on the evolution of convergence and divergence, frequently taking the European Union as comparison point have proliferated during the nineties. Amongst them, we can differentiate between those with a predominantly empirical character with the aim of creating a school of thought. Contributions from 11
the other side of the Atlantic can not be forgotten. The essential argument of the new approaches, based on empirical works, consists in reasserting the hypothesis of diminishing returns extended now to technological accumulation. More developed regions, with a greater ability for innovation than the less developed ones, enjoy the benefits of technological progress but also run with the costs of such process, whereas less developed regions can practically benefit of the same advantages than the more developed ones, by means of technological dissemination mechanisms, with lower costs, those of absorption and adaptation. The system evolves towards convergence as a consequence of diminishing returns of all factors, including technological progress, and dissemination. A natural question arises: what kind of convergence and at what rate? Researchers define three types of convergence: A first type of convergence of a variable (income per person, for example) can be talked about if dispersion of the sample values from the average, is reduced in time. This is called sigma convergence. In order to evaluate the extent of this measure, which can be acceptable for some objectives, it is necessary to consider that a possible cause for the reduction in dispersion can be that values closer to the average get closer while distances are kept at the extreme values, that is the variable range. Absolute beta convergence is talked of when all incomes per person tend towards the same equilibrium value, which is possible because regions with a lower level grow at a faster rate that the regions that are better situated, and they grow reaching the highest stationary equilibrium value which is common to all. This definition starts from the supposition that the regional economies have similar characteristics. In the case of conditional beta convergence, each regional economy converges towards the equilibrium value of its own particular stationary state, which can be estimated, but there is no tendency towards a common equilibrium. That is, it is a type of convergence compatible with the ongoing existence of divergences (Sala-i-Martin 1996a, 1996b). A relation exists between convergences although they are different. For example, there can be a beta convergence and a sigma divergence, that is beta convergence is the necessary condition, but not sufficient, to reach sigma convergence, that is, weaker regions can grow faster than stronger regions and value dispersion be maintained. Some interesting observations should be made on these notions. Firstly, the significant convergence when determining if living and welfare standards of inhabitants in less developed regions and countries evolves towards the higher levels is absolute convergence. Sigma convergence shows a reduction in dispersion from the average value, and can occur without growth as a whole. Conditional convergence seems more like statistical fireworks regarding convergence but the model that measures it is useful to identify structural obstacles that slow down growth in less developed territories. Secondly, there is no unanimity on whether empirical evidence confirms the convergence hypothesis. The empirical evidence is highly controversial due to the selection of data used for comparison. Thirdly, even amongst those who hold that the existence of convergence can be considered true, there is an argument whether it is absolute or conditional convergence. Beyond 12
technical arguments, political derivations are very important. The consequence of absolute convergence is typical of neoliberalism, which rejects public intervention, that is, regional policy, since the market is capable of correcting divergence even at a slow rate of approximately 2 % yearly, this value being discovered in most of the models applied. However, in the case of conditional convergence, regional policy would carry out an important role in order to remove the obstacles that stop a less developed region from carrying out all its growth potential to converge towards the highest equilibrium point.
1.1.3 Polarization theories The neoclassical theory, but in its essence also the export base theory (see later), are aimed at the equilibrium state of the regional economy. The polarization theories, on the contrary, (Perroux, 1964; Schumpeter, 1939) conclude that instead of convergence the development disparities of regions will grow and deepen in the long term, divergences become marked. This phenomenon is explained by three factors: the differences of the internal growth factors of the regions (amount and quality of available productive factors, the structure of the regional economy, the consumption and savings behaviour of the population in the region); the strong dependence of regions; and the existence of monopolies and oligopolies which make perfect competition impossible. The theory states that these factors give rise to strong cumulative processes which lead to the increase and deepening of inequalities whenever these have occurred. The idea of structural/industrial polarization was introduced by Schumpeter’s theory (Lengyel-Rechnitzer, 2004), who explained the role of innovation in economic growth and development. Perroux (1964) relying on this theory, drew the conclusion that in an economy the innovative industries become the engines of growth, that is growth poles. These growth engines, then, become driving forces, or just the contrary, brakes of growth, in the economic sectors dependent on them, and this way contribute to the growth of crisis in these dependent industries. Although Perroux himself did not mention the regional relevance of this theory, but the concept of growth poles naturally initiated the emergence of the spatial dimension in the related research. In the following sections a few examples of the polarization theory will be explained in detail. The essence of the neoclassical model resides, as shown, on the supposition of the market economy system’s ability to correct on its own imbalances that may appear. The relevant literature, however, provides many approaches of the opposite direction. Myrdal (1957) is the author who most precisely argued for the opposite principle, developing the theory of circular cumulative causation, explaining the growing reproduction of social imbalances and, as a consequence, the trend towards diverging regional evolution. Applying this to the regional problem leads us to the conclusion that system forces tend to generate territorial imbalances that, once started, will become 13
deeper with no exogenous intervention. This is the reason why regional imbalances are stronger in poorer countries than in more developed ones. The capital and labour force migrating from the less developed region to the more developed one, as well as the competitive advantages of the developed region usually operate to deepen the rift that separates rich regions from poor, without managing to close it. These slowing-down effects of development weigh negatively on the balance, and this is the justification for the state intervention within the framework of regional policy, which may neutralise the above effects and speed up development processes.
1.1 4 From centre-periphery theory to dependence Centre-periphery theories and the school of dependence are set on completely different perspectives, at least in their most radical versions. An essential difference exists between the positions described earlier and this one according to the stance adopted regarding the market economy system. The schools described move from those that enthusiastically accept the system to those who do not doubt in finding certain, sometimes important, flaws but without rejecting its essential characteristics. Regional imbalances would be an example of the flaws in the market economy but capitalism would have the ability to react to correct them, either by automatic compensations or by government actions and regional policy. The centre-periphery concept arose from the analysis of reality in Latin America carried out by the Economic Commission for Latin America and Caribbean (ECLAC), depending on the United Nations, sponsored by R. Presbich at the end of the 40s and during the following decades. The start of it can be found in the publishing of the ECLAC report in 1949 (ECLAC 1951) and raises a criticism on the neoclassical approach to international trade. A fundamental argument of the analysis is the confirmation that real trade relations between Latin-American countries and the developed world deteriorates in time. Together with other study elements (economy, history, sociology and politics) the conclusion is reached that economic, political and social relations of domination, exerted by the developed areas, and dependence, withstood by underdeveloped areas, are established. Agglomeration economies operate in the developed centre, investments in public and private capital are concentrated, the centres of power and decision are found, the capacity for technological innovation is developed, in short, the growth in income and wealth is much greater than in the periphery. In this share of roles or functions, the poorer or less developed areas should: • Supply the urban and industrial areas with raw materials and energy, which would be transformed outside their place of origin, with the consequent export of added value and benefits. • Supply abundant and cheap labour force to businesses established in the rich regions. • Finance the development processes of the more favoured areas, transferring savings and resources of all types. 14
The opportunity of development of some parts of the system would not exist without this role share, as it occurs at the expense of others’ underdevelopment. What generates regional imbalances isn’t the different starting levels, or the comparative advantages, or the existence of productive factors but the system’s nature in itself. Going further, the interpretation that the group of inhabitants of some regions improve thanks to the exploitation of others wouldn’t be correct either. That is, we are not dealing with the confrontation of regions against regions. According to the dependence theory, the fact is that an exploiting class, living in developed or underdeveloped areas, benefits from the exploitation of workers, even those living in developed regions which are often immigrants from the poor regions. In the more radical version, the dependence theory imputes the existence of inter-regional differences to the nature of the capitalist system itself. They are not accidental and can not be corrected, but they are directly linked to the form of production. It isn’t about difference in levels or stages reached by some regions and that others will reach in time. It would be about the different roles and positions that each region occupies within the economic and social system as a whole in such a way that there would be no real opportunity for some areas to reach development if not at the expense and underdevelopment of others. Thus, regional underdevelopment would not be an accident but the other side of the same coin. Regional policy would make little sense in this briefly described radical version. If regional imbalances would only disappear when the system that generates them is surpassed, regional and cohesion policy would make little sense. Not all centre-periphery theoreticians take their stance to such extremes. A reaction has occurred that questions the validity of a theory that focuses its attention in the conditions imposed by exogenous determining powers, forgetting the conditions derived from internal structural defects. On a regional level, however, it does not explain either, why so notorious imbalances exist in non-capitalist countries that have put a style of economic growth into practice which is limited in its potentials but with similar territorial effects, probably due to them being based on technologicalterritorial models with identical nature to those used in the capitalist West. Friedman (1973) discusses the centre-periphery theory with a territorial approach, calling the regions concentrating the innovations the centres and all the other territories the peripheries. He pointed out that the territorial differences may lead to the evolution of centres and peripheries, which form a closed spatial system, and the only way for the peripheries to break down their dependence from the centres is the centralisation of their resources. There are less radical, more moderate examples of dependence theory, like Cardoso (European Commission, 2003) the ex-President of Brazil, who allows certain industrialization of a periphery area but without reaching the capacity for autonomous growth. Capital located there would only seek raw materials or cheap labour force, obeying external decisions with a difficult or impossible control from within the region. 15
These ways of thinking were not reduced to Latin America or limited to the study of underdevelopment on a national level. They were extended to other fields, in particular Western Europe, and were applied as a theoretical analysis of historical trends on various territorial levels, such as the world as a whole (international relations), inside a nation (intra-regional relations) and to cases of economic integration of various nations in a supranational community, as is the European Union (Seers, 1979). More specifically, it was used academically during the entry negotiations of Spain and Portugal. Use of the centre-periphery outline has continued and will probably continue. Krugman (1992) has used it to explain the situation in the European regions. Even though he essentially distinguishes between centre and periphery, he has further qualified the classification of the European Union regions according to GNP per person relative to the average, differentiating internal peripheries and external peripheries (the former having less than 89 % of the average income of the EU, and the latter below the income level of 65 %).
1.1.5 The export base theory The export base theory (North,1955) assesses the factors of regional development with a somewhat different approach, focusing mainly on the internal capacities of the region instead of the external factors influencing the region. The essence of the theory is that the development of a region depends mainly on the development of its exporting sectors. The export of the scarce productive factors of a region will create the foundations of economic development in the more developed regions. The reason for this is that the export revenue facilitates the development of the infrastructure together with the development, extension and modernisation of the capacities of the exporting sectors. To carry out the development the region has to purchase investment goods from outside, and, at the same time demand grows within the region, because the production for export creates demand for the local input suppliers, and thus generates income within the regions, which, at the same time leads to the increase in the demand of consumer goods. This latter factor makes the region more attractive for businesses coming to the region from outside, and thus new companies and industries will choose the region for their location. These processes will, in the long term, lead to territorial convergence and balanced development. The core component of the theory is the distinction between basic and nonbasic activities. The basic activities are the industries producing mainly for export, and bringing incomes from the outside into the region, while the nonbasic activities are those producing for the internal market, thus competing for the incomes available already within the region, that is, redistributing the incomes brought into the region by the basic activities.
16
One of the most important problems of the theory is the method to distinguish between the basic and the non-basic industries (e.g by comparing their export shares to that of the national average for the same industries). Some criticism has been raised against the export base theory: •
The theory does not take into account the internal processes of the region, the growth generating factors of the movements of the internal market, does not count with the local investments, the local consumption structure, or the role of the government expenditures, and considers only the export activities to be the sole sources of economic growth.
•
The distinction of basic and non-basic industries has many problems, and sometimes the distinction cannot be made clearly.
•
The theory considers only the concept of the region and the external world, and does not count with the advantageous impacts of interregional cooperation. It is also contradictory because it does not define the level of regions it tries to explain. If the region to be assessed is a region of the NUTS III level, then the commerce between NUTS III regions within a NUTS II region is considered export for these NUTS III regions, and contributes to the development level of these regions. At the same time, this improves the development position of the whole NUTS II region containing these lower territorial units, but the activities leading to this result are internal activities within the NUTS II region, so they do not count as export activities.
A thorough overview of further theories of regional development and growth are found in Lengyel-Rechnitzer (2004), as well as the study published by the European Commission (European Commission, 2003).
1.2 Regional differences in the factors of production, regional competitiveness The economic potential of an area is essentially determined by the character and size of the economic activity in it. In this the role of productive factors available in the area is essential. The spatial distribution and mobility of productive factors – that is, capital, labour and natural resources – differ from each other. These influence and determine the location decisions of the economic activities, and thus the spatial specialisation (Hoover – Giarratani,1999 ; Lengyel – Rechnitzer, 2004]. The economic activities differ by their demand for various productive factors, or resources. Thus their choice of location may be determined by the available amounts of various resources, and their needs of these resources, as well as the mobility and transferability of these.
17
The output, and the mobility of the output of the economic activities plays a similarly important role. The outputs which are not easily transferable, will be produced in locations which are situated in the vicinity of the potential markets.
1.2.1 Local and transferable goods, spatial scarcity: The location factors are categorised by the extent of their immobility or mobility: - Non-transferable (local) inputs and outputs: these cannot be transported, immobile resources or products and the producers have to move their locations to the place where the input is located (or the output is demanded). - Transferable (mobile, transportable) inputs and outputs: these factors can be transported to any place, so the choice of location can be made according to profitability considerations, and economies of scale, keeping in mind that these goods are possible to transport to longer distances. It is also possible that neither the input nor the output of an economic activity is transferable (that is, we are dealing with local input and immobile output to be consumed by local consumers). For other activities the input may be immobile, the output transferable (activities based on the immobile input, called input-oriented activities), or just the contrary, the input is mobile and the output is immobile (the factory is located at the local market – a market-oriented activity). For the case of transferable inputs and transferable outputs the company may choose its location freely considering the transportation costs and the other aspects of profitability. The natural resources are generally immobile, but their outputs are usually transferable. The outputs of services are usually considered immobile, targeted at the local consumer and the local market, but their inputs are usually transferable. An exception may be the touristic services – providing accommodation, or organising touristic programmes – for which the input is a local, immobile factor, e.g. the touristic attraction, landscape, or the accommodation in its immediate neighbourhood, while the output is consumed by the tourist coming from abroad or another part of the host country, that is, not a local customer, but somebody certainly travelling a lond distance for the consumption. The production factors may also be grouped according to their scarcity. The following categories may be defined: - Ubiquity: factors available practically everywhere without limitation (e.g. air). - Commonality: factors available in most of the locations, but not everywhere (pl. water, drainage, electricity). - Rare goods: available only in a few places (e.g. specific ores, minerals). - Unique goods: very rare and very specific resources, available only in a few specific places (e.g. uranium, thermal water). 18
Naturally the two categorisations – transferability and spatial scarcity - do not mean rigid distinctions, the groups themselves are relative definitions serving the purpose of comparisons, or scales rather than absolute categories. In the following sections a brief overview is given about the characteristics of the various production factors and resources.
1.2.2 Natural resources Natural resources are the least mobile factors among the productive inputs. Some types of them are absolutely immobile, and cannot be transferred at all, but are available only in their original location (e.g agricultural land, specific climatic conditions), while other types can be transported to a limited extent, but at high transport costs (excavated minerals). Activities, for which the natural resources are essential, must adapt their location decisions to the spatial occurrence of these natural resources. Usually, the quantity of available natural resources cannot be increased, and their pollution or exhaustion is a great danger in their utilisation. An example of the mobility of natural resources may be the situation when a company requires mineral water of special quality, and this mineral water is used at a distance from the well, so that it has to be transported. Similarly, excavated, but not processed minerals can also be transported, but only in relatively small quantities, and under special conditions. An example to the contrary may be the touristic service based on the specially attractive natural environment, because the tourism business will have to choose its location considering the immobilitiy of this particular natural resource. A similar example is a business which produces a large volume of wastes as a by-product, and the natural resource it needs is an area suitable to dispose of the waste; or a livestock enterprise for which agricultural land is needed to spread manure and slurry. For an enterprise like this the location decision will be influenced by the availability of land to be used for waste disposal.
1.2.3 Labour The human resource is considered to be one of the most important factors determining the choice of location for a business. The role of human beings in the spatial arrangements of economic activities may be multiple. On the one hand, human beings are the labour (that is, and input factor) in production, and on the other hand they are the consumers (that is, the buyers and users of the output of the production), and they influence the business decisions of the enterprises in a third role as well, namely as owners of houses or flats, competing with the enterprises for their business location or land. The reasons for the migration of labour can be either of economic or of noneconomic nature. Among the non-economic reasons the natural 19
catastrophies, war conflicts, family reasons, adventure seeking may be listed, as reasons forcing the workers to leave their native regions and try to earn their living in another region, or even in another country. Among the economic reasons the high unemployment rate of the home region, the wage differences between the home region and the destination, the possibility of seasonal work, the better working conditions in the destination region, or the high prestige associated with working in the destination region may be mentioned. The migrating labourers can be classified into two groups which are markedly different. Namely, the very highly qualified workers and those without any training or qualification. The reasons for migration for the highly qualified labourers may be: the learning for the qualification, to attain a specific further training together with working in a job (preferably in the area of the targeted qualification, for which the person will have to spend a longer period in the destination region) – this migration is only temporary, and after attaining the qualification the employee returns to the home region. A similar migration type is migration for the maintenance and updating of he qualification attained earlier, or migration for doing research, which are again of limited duration. However, sometimes highly qualified employees are unable to find suitable jobs or suitable work conditions for their qualification in the home region, and this is why they choose to move to a more developed destination region (often to a foreign country), and this move is often meant as a permanent change, without the intention of returning later. Another similar example is the situtation when the highly qualified employee cannot get a suitable salary for their qualification, and this is the reason why they leave the home region in the hope of finding higher salaries elsewhere (this is called brain drain). As a result of this process the highly qualified labour force trained in the underdeveloped region for high costs, will create the returns of the qualification in the developed destination region, increasing its output value, while the total costs of training this person are covered by the underdeveloped region. This way the qualified labour, instead of diminishing the gap between the developed and the underdeveloped regions, actually contributes to the increase of these development inequalities. The mobility of non-qualified labour also shows specific features, The main reason for migration for such labour is the favourable expansive state of the destination region, and the lack of sufficient labour during the expansion, which also causes a rise in the wage levels. This usually affects the areas requiring unqualified labour, too, and initiates labour immigration from less developed regions. This can happen as a long-term employment or short term, even seasonal work. The long-term employment possibilities typically lead the migration of unqualified labour to the developed regions (e.g to the countries of the EU from their former colonies, or immigration from Eastern Europe), while temporary jobs, seasonal labour demand may happen in less developed regions too, for instance, in agricultural regions during harvest time (in Africa or South America it would happen during the harvest of cocoa, cotton, or coffee). The migration of unqualified labour is sometimes linked to illegal work, especially in the vicinity of the borders, when workers of the peripheral regions over the border come and work for very low wages 20
under very bad work conditions in the businesses of the more developed region - typically in the building and construction industy. In regional economic analyses the following questions are raised with regard to the spatial mobility of labour: what are the regional wage differences, what opportunities are found in the various regions, local communities for finding jobs or finding housing, etc., and what are the trends of population dynamics and migration in the regions. In the following section these factors will be discussed in more detail. The regional income disparities In assessing the regional differences of incomes we may look at the average incomes of a family/household within the region, or the average real wage paid for a specific job or employment in the region (in which besides the nominal wages the average costs of living in the region should also be taken into account, as an adjusting factor), or, from the viewpoint of the employer, the total cost of employing the worker (that is, the nominal wage + benefits in kind, compared to the productivity of labour). Generally the following tendencies can be observed: Income disparities exist among various regions, or within the same region, among the settlements of various sizes. Also typical spatial differences may be noted in the average wage rate of the same profession or vocation, and these differences are more marked for unqualified jobs than for qualified ones. The value of the higher income will be perceived by the employee only if it is not neutralised by the impact of higher costs of living. Generally the costs of living are higher in the areas where wages and salaries are higher, but if the differences of the costs of living are smaller than the differences in wage rates, the employee will really perceive the advantages of higher wages. Thus the following definition may be introduced: real income = the nominal income / price of the consumer basket , and using this definition, and describing the cost of living by the price of the consumer basket the differences of real incomes can express for the employee the true income advantages of a region or a settlement. The wage rate disparities in this way will compensate for the differences in the costs of living, housing, and only the part of the wage/salary above this will be perceived as a motivation or incentive to move (for the employer this difference is not observable, because the part of the wage covering the difference in living costs will be perceived in the same way as the real wage difference, as the cost of labour). The estimation of the costs of living, that is, the equalizing differential in the wage is often difficult, because it has several hardly quantifiable or nonquantifiable components. Practical experience shows that the real income correlates to the money income, thus the differences in living costs are much smaller than the differences in the money incomes. One of the basic reasons for wage and income differences is the supply of labour in the assessed region. The supply of labour in a given community, 21
area is rather inflexible: only migration (that is, the immigration of labour into the region or the emigration of the labour from the region, or the presence of the labour force in the labour market (depending on the age of the worker entering the labour market or leaving it at retirement or for health reasons) can change it. The quantitative changes are parallel to the population of the region. At the same time the composition of the labour force, its qualifications, professions and other factors determining the type of employment (working hours, holidays, etc.) also influence the total labour supply available for businesses working in the region (Lengyel-Rechnitzer, 2004). The elasticity of labour supply is higher in a specific vocation or profession within the region, than the elasticity of the total labour supply. The reason for this is the fact, that the employee may learn a new vocation/profession, take part in job trainings, or may change his/her field of activity even without training. This means that there is a kind of mobility between the labour supplies of specific jobs, which makes the labour supply for a job more elastic. The labour supply available for one employer, or business enterprise is even more elastic, because here the employer may attract labour not only from other industries (jobs, vocations or professions), but from the same industry, too, that is, from the employees of other businesses of the industry (and the same is true for the opposite direction, labour may leave the particular business to work for another employer in the same field). The above explanation about the spatial imbalances of labour show that it is the willingness for migration that makes the greater differences in the regional labour supply. The demographic trends of the population are rather similar within a country, so these do not cause great differences among the labour forces of the regions. It must be noted, however, that here migration means the moves of labour, when the employee changes not only the job but also the place of living, the home, too. When the labour moves are not followed by the move of the home, then the process is called commuting and not migration. Supposing the perfect spatial mobility of labour, as in the neoclassical theory, the same real incomes would be found in each region regardless of the differences in money wages. Otherwise the labour would migrate from one region to the other, whenever higher real wages could be achieved. In these regions a labour surplus would be the result, which would lead to decreasing money wages, and then the real income advantage would disappear. In accounting for the benefits and the costs associated with migration it is not enough to compare the basic salaries/wages only. The fringe benefits, benefits in kind, and premiums should also be considered – regardless of their money or non-money character. Another important aspect to consider is the job opportunity for the spouse of the migrant worker. As it was stated earlier, besides the wage rate the costs of living, the quality of the work, the carreer prospects, the job security, the structure of employment, and as a consequence of the latter, job opportunities for other active age household 22
members, as well as the desirability of the host community, cultural and recreational facilities (the social and cultural infrastructures) are all important aspects to be assessed when comparing the old and the new location. Labour migration can be classified by several characteristics. A classification may be made by the type of the crossed border, defining internal and international migration. A classification by temporal aspects defines permanent and temporary migration. The spatial classification may be done by the distance covered and the direction of migration. Spatial migratory forms In the present brief summary the main task is the analysis of spatial migratory forms. The analysis will be done in three steps, assessing three important aspects of migration. These are: - The origin and the destination of migration, - Difficulties and barriers for migration, - Personal traits of the migrant.
-
The characteristics of the origin and the destination of migration • The pleasant and attractive environment at the destination (cultural and social infrastructure, attractive environment). • The desirability of larger settlements is increased by the availability of more varied job opportunities (this may explain the migration to the suburban areas around cities). • The attraction, the pulling power of the positive features and the pushing effect of the negative aspects work together in migration. The pull effect is experienced when the main reason for migration is the positive aspects and the desirability of the destination, while the push effect is experienced, when the main incentive is to escape from the origin. The push effect is usually caused by demographic trends and not the negative economic conditions! (e.g. many well-trained young workers are searching jobs in the region without job opportunities for them, and this initiates the migration of well trained labour from the region). The pull effect is caused mainly by economic impacts, making the prosperous destinations desirable for migrants. • A large volume of immigration may go together with large volumes of emigration, because the immigrant may feel disappointed with the opportunities of the destination, and decide to go back to the original home. Another typical pattern is „chain-migration” when the migrant worker stops only temporarily in the first destination, and later moves on, toward the final destination, which is then reached in several stages, taking the intermediate stops as transitory regions (countries). (An example for this is the migrants coming to Hungary from our eastern neighbour countries, of from the Far East, whose final desired destination is the developed countries of the EU or even the USA.
-
Difficulties and barriers of migration 23
The most important factor influencing migration within the country is the distance covered. The distance does not simply mean the straight line distance between the origin and the destination, but it is the measure of the total cost of moving. This may mean the money and time costs of the travel, or the actual distance covered travelling by road or rail (similarly to the idea of the accessibility indicator, discussed earlier). The distance may be a physical, geographical distance, or social distance (cultural, religious, behavioural distance, difference in the habits and customs of the population, administrative requirements hindering immigration). This may explain the fact that the volume of migration within the country is higher than the volume of migration crossing national borders. With the fast development of communication technology and the wider use of telecommunicaton systems and the internet, the globalised world shows a definite decrease of such social distances. The impacts of barriers of migration are decreased by the use of paths that have been used by masses of people before – that is, the use of the „tread paths”. Labourers move more easily in the directions, to destinations which have been favoured by many earlier migrants. Travel and job agencies may be specialised to these favoured routes, and assist the migrants in organising the move, travel, immigration, or administrative arrangements of settling down and finding a job. The importance of the tread path is that it decreases the uncertainty and risk for the migrants, and thus diminishes the impacts of an otherwise significant barrier. The impact of the tread path is particularly important, when large cultural distances exist between the origin and the destination, e.g. for migration from Europe or South America to the USA, or for migration from North Africa and Turkey to the European Union. -
The personal traits of the migrant (labourer) The personal characteristics of the labourers greatly differ, and this influences the incentives of migration. The subjective influence of the same incentive may be completely different for different persons. Among the personal traits the role of the following seems to be the most important:
Age – The same person’s inclination for migration may change with age, and it is usually the age of young adulthood, when the person is most inclined to migrate. Level of schooling: in every age group a higher inclination for migration is seen for the people with higher qualifications than for the less qualified, Job status: in every age group higher inclination is seen for those of higher job status that those with lower status of employment. Personal traits depending on the character of the migrant: the inclination for migration may differ for two persons even if they are of the same age, same job status and same level of qualifications.
24
It can be stated, in general, that the participants in the migration process are a group more dynamic, better qualified, and generally more talented than the average of the region of origin, so by their emigration the average indicators of the origin deteriorate. At the same time, the immigrants are less qualified, less dynamic and less talented than the average of the destination area, thus, for them the integration into the society of the destination is a real challenge (as can be seen in the example of the immigrants coming from Latin-America into the United States). The impacts of migration on regional development Migration has different effects on the development of the region of origin and the destination, and its impacts also differ in the developed and in the underdeveloped regions (Lengyel-Rechnitzer, 2004). In a peripheral region of origin the majority of the labour force is unemployed or underemployed, thus the emigration of labour decreases the social expenditures and transfers provided by the local governments. The public financial resources liberated this way may be employed in investments for regional development, which may have positive impacts on the level of underdevelopment. However, the migrants are typically the better educated, more dynamic workers of the region, which leaves the average level of education and the average quality of the remaining labour force lower. This may be unfavourable regarding future investment intentions. It is also a fact, that better qualified labour is more difficult to substitute with capital investments, and in underdeveloped regions the investments are usually oriented to the utilisation of cheap labour and not the utilisation of high technology. Another negative consequence is the fact that the migrant qualified labour decreases the labour supply options of the businesses working in the region of origin, and this may cause the closing down of some of the production activities, and this may force the enterprises to leave the region and choose a new location with better quality labour supply. This, however, will threaten the jobs of the non-migrating labour force, too. The partial lack of labour in the region of origin may cause the return of the workers who have left the region earlier. For migrating labour it is not rare that the rest of the family remains in the region of origin and the migrant family member provides financial support for them. This raises the amount of disposable incomes in the region, and increases consumption, which is beneficial for the profitability of businesses in the region, and for their level of output, as well as increasing the productivity of labour at the enterprise, thus generating hugher incomes, and acting against further migrations. By way of migrant labour the region receives important information effects, too. The region of origin may get acquainted with the consumable goods, technological, cultural and social information which may lead to further emigration events. 25
The migrated labour often returns for holidays, later the retired migrant may move back to the region of origin, and by having good knowledge of the place, may attract the inhabitants of the destination region. This fact may boost the tourism sector in the region of origin, and increase the income transfers from the destination to the origin. The destinations of migration are the agglomerational zones of metropolises, the economic centres, which offer higher incomes, better working and living conditions, better choice of accessible consumer goods and services, and altogether a better quality of life for the immigrant labour, than the region of the origin. The immigrant labour in the destination region will increase the output potential, and for highly qualified immigrants it will improve the average level of qualifications in the destination region (this is not always true, because in peripheral regions the labour of highest qualification is still below the average qualification level of the destination). The inflow of highly qualified workforce into the destination region facilitates the adoption of more developed technologies, and this, in turn, helps the further improvement of the output, performance, and productivity of the destination region. A negative effect is, however, the fact that the newly arrived labour competes for jobs with the local labour force in the destination region, and this often gives rise to worries about increasing unemployment rates. It is particularly true in the case, when immigrant workers accept wages significantly lower than the wage rate of the destination, and this raises questions about the opportunity of cutting wage rates in the destination region. Empirical research, however, indicates that the immigrant workers moving into developed regions do not increase significantly the local unemployment rate (e.g. for the case of Turkish and North African labour in the EU), because their average level of qualification, and low language skills restrict them to apply for less qualified job, which are not attractive for the original workforce in the region. In the case of white collar labour of the highest qualifications such impacts may be experienced, but their mental productivity and the benefits of their professional activities can compensate for this effect (considering that they provide and utilise their skills and knowledge, adding their production to the economic performance of the destination region while the costs of their training were paid by the region of origin). The age structure of migrants is typically younger, and the high proportion of young immigrant workers makes the demography of the destination region also younger. It will create new demand for the social services of the destination region (schools and nurseries) to supply for the families of the immigrants, thus causing an increase in the social expenses of the affected local governments. The immigrant labour may find new markets in the region of origin for the products of the destination region, and may make the products and goods coming from the destination region more acceptable or liked, by influencing the value judgment of the inhabitants of the region of origin. The migrant labour, having become successful in the destination region and making his/her fortune may be an encouraging factor for further migrations towards the destination region. 26
Finally it must be mentioned that cultural conflicts may often emerge between the immigrants and the native population of the destination region, especially if the people involved relate the new tensions created by the employment of immigrants to ethnic identities and differences of cultural traditions and customs. The successful assimilation and integration of immigrants into the culture of the destination may help in resolving such conflict. If, however, this cultural integration cannot be achieved during a longer period, then the immigrants become a segregated group, and this leads to the creation of ghettos. The coexistence of immigrants and native inhabitants is successful when the destination area is populated by an open, receptive, multicultural society. A good example of this is the „melting pot” of the USA, and a counterexample may be the society of many European countries with their hostily approach to immigrants.
1.2.4 Capital goods The worldwide flow of money is a very rapid process and for this reason it brings about great dangers, too. The destination/location of so-called portfolio investments is chosen by the highest returns of the moment, and this money moves on immediately, if the prospects of higher returns are better elsewhere. Thus the money/capital supply of an area/location can go through considerable changes wihtin a very short time, and this may influence the economic potential of the region significantly. The investments into working capital, that is, direct investments have a somewhat more beneficial influence, their mobility means less vulnerability for the receptive region. With these investments it is in the interest of the investor to maintain high rates of profitability for the money invested in real capital units, to achieve high returns on the investment to pay back the investment costs – and this is usually a multiannual process. Thus the host region can count for the presence of the capital investment in the long term, together with its positive impacts on job creation, income generation, and consumption, as well as on the outputs and export capacities (Simai-Gál, 2000). An interesting form of the export of working capital is the technology transfer, which is a key factor for the development of world economy. The components of this – actually, the elements of the diffusion of the innovation process, namely the diffusion of the technology, the absorbtion, adaptation, and finally the actual transfer of the technology (as transport of machinery, equipment, licences or standards from one area to the other, from one country to the other). Besides the export of working capital, technology transfer may mean the transfer of know-hows, licences, technical documentation, that is, the export of human capital. The international flow of capital is the most important relationship among the linkages in the world economy. It may be done in the form of international real capital flows: that is, foreign direct investment (FDI), or the 27
international flow of money (foreign portfolio investment – FPI), which means the purchase of a share in a company or the offer of credits or aid. Foreign direct investments, that is, the export of working capital may be defined in several different ways. The essence of the concept is, however, that the sender (country or region) will gain control over the economy of the receptive region. This may be considered as an equalizing process of productive factors throughout the world, when capital moves from the area of capital surpluses to the regions of capital shortages (although empirical evidence shows just the opposite directions for capital flows), and finally it can be interpreted as a process which strengthens the co-dependence of countries, and improves the international system of relations. The definition by UNCTAD (United Nations Conference on Trade and Development) considers foreign direct investment as an international investment in which the business unit of one country gains long term shares (business interests) in the operation of a business located in another country (Simai-Gál, 2000). This is a long-term relationship between investor and company. The international flow of money capital, on the contrary, that is, the foreign portfolio investment means the purchase of stocks and shares sold in international stock exchanges (that is, the purchase of bonds, shares, derivatives, etc.) which does not mean a direct decision-making power in the everyday management of the firm receiving the inverstment, and does not lead to restricted decision-making capacities of the management of the firm. The direct investment contributes to the establishment, implementation and installation of new technology in the form of real capital, that is, fixed assets, while the portfolio investment raises the required funding for it. The exporter of working capital plans for a longer investment period, and is interested in the long term return on the investment, while the time span of the portfolio investment may be sometimes very short, and is motivated by the immediate short term gains on the invested money, and may move on at the slightest hint of riskiness of the investment. Thus the motivation for the investors also differ. The exporter of the working capital is interested in the efficiency, longterm profitability, and growth of the firm into which the investment is made, while the portfolio investor is interested in maximising short term interest rates, exchange rate gains or dividends. For this reason direct investments are more stable, less vulnerable, and react only to the changes of the business cycle, while the portfolio investments are more sensitive to the psychological impacts of the markets. The motivation for foreign direct investment, or for export of working capital may be the utilisation of varied production factors, that is, the differences of natural resources, or of labour qualifications. Another such reason may be a cause related to the company strategy, e.g to avoid competition, access to new technologies, access to new markets, utilise favourable business environments created by the national or local government of the receiving area, or the need to follow the business partners, the fulfilment of the needs of the local market by local production, or the lower costs of production at the location, and the presence in the local market to keep the market positions in the globalised markets and the avoidance of protectionist trade regulations (Simai-Gál, 2000). 28
In describing the reasons and directions of interregional capital flows a frequent assumption is the following: the investments want to maximise their profits, that is, the investor will take the investment to a location where the rate of return is the higher. Thus the capital will flow from the regions of lower rates of returns, to the area where higher returns can be gained, then in this region the production capacity grows, the output increases, leading to decreased rates of return, and this results in the equalitation of the profitability rates (neoclassical theory). Reality, however, shows a very different picture. First of all, let us declare that capital cannot be considered a perfectly mobile factor of prodction. Capital invested in land, for example, cannot be mobilised and moved to elsewhere. Farming is typically a location-bound activity, and similarly, the investments made in industries cannot be rapidly and cheaply mobilised either – just take the example of buildings, storehouses. Of course, there are good examples of the situation, when some piece of production capacities becomes too old or obsolete, and when the new and high quality machinery is purchased, it will not be installed in the old location, but be moved to a new location. Even in the case of new investments other important considerations are made besides profit maximisation, and these are limitations to the interregional mobility of capital. The new investments are attracted to an already existing location, investors favour their own businesses instead of the business established and managed by some unknown persons. The insufficiency in communications, infrastructure, institutional system (e.g the banking system, or financial markets) may discourage investors even if the rate of return seems to be higher. The same impacts are experienced for highly bureaucratic administration, corruption, or the uncertainties of the legal system. Another factor against investments coming into the region may be the low level of qualification, or the lack of experience of the available labour, while the investment-friendly approach of the national government towards the foreign investors. Empirical evidence in Hungary shows that the capital investments have been concentrated in the central region around the capital of the country, because the economic decision making centres of the productive and the services sectors, as well as the qualified labour force, the developed working cultures, and the infrastructural conditions, the easy and quick accessibility, and the support of state and local governments, the national and regional economic policy and the basic conditions determining the quality of life (that is, the housing conditions, the health care system, integration into the local society) increase the capacity of this region to attract capital investments. The impacts of the mobility of capital to the economic growth of the region differs for the region of origin and of destination. The increase of capital stock in the destination region leads to the expansion of production potential, the production capacities, while the region of origin will suffer a constriction impact of the same size. As a result, as the neoclassical theory concludes, the region enjoying expansive effects will experience the growth of supplies leading to the decrease in the rate of profitability, while in the 29
region of origin suffering constrictive impacts market shortages will increase prices, and rates of profitability, that is, an equalization process takes place. According to polarisation theories this equalisation cannot take place, because in the destination region the increased amounts of accumulated capital create agglomerational economies, which leads to further increases in the rate of profitability, and this fact attracts new investors into the area. Another consequence of these cumulative impacts is the fact, that investors would prefer these regions even with lower rates of profitability, and this makes development disparities, instead of equalization, more accentuated. In assessing the impacts of capital mobility not only the amounts are important, but the way of utilisation, too. The capital investments are directed to particular economic sectors, where they create new job opportunities, require the utilisation of the resources of local economy, creating demand and initiate cooperation processes within the region.
1.2.5 The relationships of various factors of production Capital, labour and technological development affect regional development in different ways. The movements of capital and labour decrease the production capacities in the region of origin, and create a constrictive impact on the regional economy. The export of technology, however, does not have such negative impacts in the region of origin, but on the contrary, may give rise to new incomes, and generate further developments, innovation processes. In the long term, the export of technology may also have negative effects on the region of origin, because the adopted new technology in the destination region improves the competitiveness of this region, and due to the new technology the destination region becomes a competitor to the region of origin, wich may slow down the development of the origin. Technological development may lead to savings in the amount of utilised labour or capital, which means, that production may grow without increasing labour or capital inputs. Under unfavourable market conditions with increased production there is a danger of increased amounts of unsold commodities, which may later lead to dismissal of worker and loss of jobs. The renewal of the regional economy is highly dependent on the capacities for integrating, and utilising the new technology and knowledge. For this sufficient numbers of well trained labour force, and a level of capital investments is necessary. In the more developed regions sufficient levels of capital and shortage of labour are the typical, while in less developed regions capital shortage and excess labour are the characteristic features. Thus, in less developed regions the adoption of labour intensive and capital-saving technologies seem to be the reasonable to adopt. Besides economic conditions the technology level of production has decisive role. In accelerating the growth of a region it is beneficial to have high technology levels in at least one or two sectors of the economy, with modern machinery, and continuously renewed product structures, because these facilitate the export activities of the region. 30
1.3 Characteristics and determining factors of the development and growth of a region After reviewing the key concepts, main development theories and the characteristics of productive factors we will focus on the specific features and problem areas of regional development in three main areas. These are the population and demographic trends in the region, the income per person and the structure of the regional economy including the share of the various sectors in employment and in market sales (Hoover-Giarratani, 1999).
1.3.1 Aspects of regional development Population and demographic trends in the region In assessing the growth opportunities for a region the main factor is not the absolute number of inhabitants, but the rate of population growth. There are large differences among regions in this respect. The demographic trends in developed countries show the increase of the average age of the population, the decrease in the number of births, and thus the stagnation, or even slight decrease of population. This may lead, in the long term, to a considerable decrease in the active population, and to a shortage in labour necessary to maintain a high level of welfare. The immigration of labour from underdeveloped, peripheral regions may somewhat moderate this decrease. Among developed countries the growth rates of population tend to be equalized. In developing countries, however, the number of births is high, the age structure is younger, and, as a result, and also partly due to the worse health conditions, the average age of the population is lower. The main problem in these regions is the very fast increase of the population, and this threatens with a demographic crisis (in India and China), because the expected size is higher than the capacities of the regions to maintain the population. Regional trends in the incomes per person Describing the incomes per person in regions as a percentage of the national average, permanent differences can be observed within most of the developed and developing countries. The concept of equalisation and conditional convergence was discussed in the section introducing convergence and polarisation theories. Besides acknowledging the differences of average incomes of various regions in a country it must be remembered that the regional averages may often cover large income disparities within the region itself, which should also be diminished. One type of convergence allows the convergence processes within the region without the slightest convergence between regions (beta-convergence). 31
The relationship between regional income levels and the size of the region is an interesting issue to analyse. It is generally true, that larger regions may be more attractive, due to the larger agglomerational advantages and cumulative impacts, more varied resources, larger market sizes, and for this reason they are usually richer than smaller regions. A counterexample of this is Luxembourgh, one of the richest regions in the EU, being the one of the smallest in terms of population and area. In assessing regional income levels the theory of North-South polarisation should be mentioned, and the comparisons between the USA and the EU. With respect to the latter it may be remembered, that contrary to the general opinion there are no great differences in wage costs of the United States and the European Union, but the productivity of labour is lower in Europe than in the USA. The American living standard is not much higher than the European, because higher incomes in the USA come together with higher costs of living. In comparing the living standards and the quality of life in various regions the hardly quantifiable environmental advantages must also be kept in mind. Structural changes in the regional economy In assessing the economic structure of a region the share of various industries, sectors are compared in the output, employment, incomes, etc. of the region. These shares are compared to the national averages and thus the leading industries of a region may be identified.
1.3.2 The four key questions of regional development The characteristics and differences in the level of development of regions may be explained by answering the following four key questions: •
What are the causes of growth? Knowing the characteristics, the income, demography and economic structure of the region, the question is to identify the main factors that are capable of initiating and enhancing positive processes. According to the export base theory the main driving force for regional development is the export of the region. The question here is to identify the causes initiating the growth of incomes from export. Basically the incomes will grow as a result of growing export revenues, in which the increase of the volume of export has a crucial role. Two components must be kept in mind here. One is the demand for the exported products of the region, which has to grow to make export revenues increase. The second component is the capacity to produce the exported products in good quality and quantity, at favourable cost levels, in which the resource availability of the region has the key role. Thus two main groups of causes have to be taken into account: the external demand for the region’s exports and the quality and quantity of production resource available in the region. 32
According to the export base theory the economic activities of the region are divided into two groups. The first is the basic activities producing for export, which lead the growth of the region and bring external incomes into the region (e.g. tourism, products sold outside the region). The second group is the group of non basic activities, serving the internal demand of the region. The growth of the basic activities enhance the growth of non-basic activities, too. For example these sectors provide commodities for the labour working in the basic sectors, or inputs and raw materials for the production of exported goods, and in both cases they receive a share of the revenues of the exported goods, so the nonbasic activites participate in the internal income flows and redistribution of the region.
•
What is the relationship between economic structure and growth? Here the role of economic structure in the development and growth processes of the region should be clarified. Components of the economic structure should be identified which are best fit to the characteristics of the region, and can become driving forces of development. Here the export base theory should be remembered, which emphasises the role of sectors capable of exporting, and considers these the engine of development. The question to answer is, whether the current structure of the economy is capable of generating high incomes and high growth rates in the long term, and if the answer is positive, then how to develop these further; in the case of negative answer the industries to be closed down and the industries to be developed should be identified, and the related employment and supply-demand aspects handled. The economic structure of the region is determined by the available resources, comparative and competitive advantages that a region owns. The development of industries (sectors) best fitted to the available resources leads to the exploitation of comparative advantages. Thus labour-intensive sectors should be developed where capital is the scarce resource, and capital intensive sectors should be developed where labour is the scarce resource. As it was already shown in the discussion of resources the capital and labour can substitute for each other to a certain extent, and this leads to an equalizing effect for the availability of these two factors. Besides resource availability another important issue is the market demand for the products and services, because this will determine the incomes generated by the economic activity best fitted to the resources of the region. Thus many regions with excellent resources for agricultural production suffer from crisis nowadays because the development of agricultural technology resulted in great surpluses in the developed world and even the areas with less favourable conditions for agriculture are capable of producing food of excellent quality. Thus regions specialised for agricultural production cannot find markets for their surpluses, or if they do, then at very low prices.
33
Similar problems are suffered in regions with coal and iron ore resources, because steel and machinery production having been the basic industries of development have been in crisis recently. The impacts of resource availability are modified by the trade relationships and movements of productive factors, and these usually encourage growth, because – in line with the export base theory – allow access to inputs and incomes from outside, which may enhance economies of scale and agglomeration. The interregional movements may include trade of outputs, trade of productive inputs, migration of people, and movements of capital. The export base theory neglects the important fact, that growth may be initiated not only by external trade relations, but also by internal trade flows, too. This can be easily understood considering the example of a large region (NUTS II level), which consists of 3 smaller territorial units (NUTS III level regions). If trade grows between the NUTS III regions, intensive export-import activities are taking place, this induces growth in every NUTS III region by the more efficient utilisation of resources. This, of course, will lead to the overall growth of the NUTS II level region, although the activities inducing this growth are all internal activities, that is, the intensive trade processes between the NUTS III regions. •
Are there signs of convergence, and if yes, can they be considered permanent or long-term trends? Here the development indicators of the region are compared to those of developed regions to see whether the differences decrease, or whether the regional indicators are likely to converge towards, or increases above the average indicator values of the larger territorial unit (macroregion, country) that contains the region in question. Here the general statements of the formerly discussed convergence or polarisation theories can be empirically checked for the region. Besides the convergence of the region to the larger territorial unit another important question is the decrease of inequalities among the smaller territorial units within the region, that is, the emergence of convergence processes within the region. In assessing interregional convergence the growth inducing factors and causes have to be identified, which speed up the growth of the region and lead to convergence phenomena. Available empirical evidence shows – see surveys, studies, reports of the European Union, e.g. ESPON and TEN studies – that the development of transportation and communication networks is a crucial precondition for the convergence of underdeveloped regions without which these regions are left behind and continue to decline. Mobility of capital and labour also contributes to the catching up of underdeveloped regions, because it decreases the dependence of regions on the location of natural resources. The utilisation of natural resources becomes possible by the inflow of capital and labour from other regions, and if natural resources are missing from a region, then conscious economic policy directs the development of the region in sectors less 34
dependent on the availabiliy of such resources. Interregional trade also helps the convergence processes of regions. Polarisation between regions is related to three specific features nowadays. Some of the underdeveloped, declining regions have unfavourable economic structures, and a strong dependence on agriculture, in particular. The majority of disadvantaged regions – as was mentioned before – suffer from difficulties of communication and transportation. The bad quality of roads, the insufficient density fo transportation networks, the lack or low technological level of communications channels are typical problems in these areas. The lack of agglomerational advantages is another factor to lagging development. The neighbourhood of big cities, the developed regions have such agglomerational advantages (large markets, good transportation system, high quality financial and business services for the business actors, good selection of available inputs, favourable transportation infrastructure, etc.) which makes these areas desirable for new capital investments as locations, instead of moving towards the less developed areas. This phenomenon strengthens the growth advantages of central, developed regions and aggravates the decline of underdeveloped regions. It must be noted, that the above factors were explained as components of regional convergence, these could be applied in the same way to the development and convergence problems of local territorial units and settlements, towns and villages, too. •
What is the role of economic policy in regional development? The last question tries to identify the possible measures, external, governmental or institutional interventions, financial or technical actions that may contribute towards the balanced development of the region, or the smaller territorial units within the region, and the speeding up of the development of those left behind. Some of the theories discussed earlier criticise external intervention and deny its positive impacts, others agree with the need for intervention and consider them desirable. The answer to the question depends strongly on the possibilites, resources and conditions of the particular region. Some of the earlier discussed regional growth theories – at least in their radical form – deny the possibilities of economic policy to enhance regional convergence. In spite of this, at least by the empirical evidence found in the EU, target-oriented economic policy may initiate and speed up growth processes, and – at least under suitable conditions – convergence may take place. According to the contemporary experiences it is one of the aims of economic policy – either on national or supranational levels – see the examples of the National Development Plans, national programs and actions for the first, and the Structural and Regional programmes of the EU, the development programmes of the United Nations, the World Bank, and other international organisations for the second - to help the 35
catching up of underdeveloped regions by initiating development projects, although results are contradictory. According to the viewpoint of the European Union the support coming from central development programmes complementing the local initiatives and local resources has a crucial role in the spatial equalisation and convergence of regions, and for this reason the history of the regional policy of the EU as well as the new cohesion programme for the period of 2007-2013 gives priority to the economic policy measures aimed at territorial equalisation.
1.4 Regional competitiveness Regional competitiveness within the globalised economy is a key precondition for the success of a region. Within the context of globalisation several stages of competition can be distinguished, thus a region may experience its impacts in various ways and depths, or in due time, goes through all of these stages one after the other. The stages of global competition are usually the following: i, foreign companies enter the local and regional markets; ii, internationalisation of production (that is, international movements of inputs and outputs) among regions; iii, multinational and transnational companies emerge, the base company and its affiliates operate in different regions, or countries, and their internal relationship gains an interregional, international aspect; iv, extensive and complex relationships and interdependence of companies in the global competition, and due to this, the interdependence of regions, areas increase. There were a number of attempts to define the notion of standard and extended competitiveness in the mid 1990s. On the basis of the Sixth Regional Periodic Report (European Commission, 1999) and the Second Cohesion Report of the EU (European Commission, 2001), the standard definition of competitiveness can be stated as follows: “the ability of companies, industries, regions, nations and supra-national regions to generate, while being exposed to international competition, relatively high income and employment levels”. It is clear that the concept of competitiveness cannot be restricted to the high values of economic growth and of macroeconomic indicators describing the performance of the economy, but similarly important elements are the high level of employment and the resulting high levels of household incomes, which essentially determine the quality of life in the area. Thus regions, towns and countries are competitive, if their economies are open, their per capita income is steadily high and increasing and if they are capable of sustaining a high rate of employment, i.e. if large segments of the population can expect to benefit from the income realized.
36
The following indicators are used to measure regional competitiveness (Lengyel, 2000; Lengyel-Rechnitzer, 2004): Income: regional GDP/person („Gross Regional Product – GRP”) The measurement of regional GDP is often problematic, because the incomes and performances of commuters, and of activities done over the border should be divided between the regions involved Regional NDI (net disposable income) This income figure shows the proportion of incomes generated within the region, and those flown into the region from outside, that the local inhabitants can use for their own purposes. This indicator is derived from the value of regional GDP (that is, GRP), adjusted by the income relationships with „the external world”, that is, incomes of labour and capital and transfers moving to and from the region.
The following equation describes the relationship between the components of competitiveness (Behrens, 2002; European Commission,2002):
GDP
−−−−−−−−−
GDP
=
total population
−−−−−−−−− no. of employees
•
no. of employees −−---−−−−−−− working age population
•
working age population −---−−−−−−−− total population
The indicators in the above equation can be interpreted in the following way: GDP --------------------------------number of employees
number of employees ------------------------------------working age population
working age population ------------------------------------total population
=
GDP value for one employed person, that is, the productivity of labour (PL)
=
=
rate of employment (related to the level of unemployment) (E)
proportion of working age population, about the same for the whole country, representing age structure of the population (AS)
Regional competitiveness may be measured by the so-called unit regional income, where: unit regional income = labour productivity • rate of employment
37
For the development of a region the objective is to create economic growth by increased labour productivity (PL) and by maintaining a high employment rate (E). In practice labour productivity and employment rate tend to move into the opposite directions, at least in the short term. Technological development leads to a considerable increase of productivity, creating situations when one person with the modern technology will do the same work quickly and efficiently, which used to be done by several persons, which means that labour productivity has increased. The redundant workers are dismissed, the employment rate decreased. This kind of increased efficiency cannot be considered a positive, favourable process. The advantages of such labour substituting technological development could be successfully utilised if the redundant labour was redirected to other areas and be employed efficiently elsewhere. This may be done by retraining of labour and utilising them in another, human resource-intensive sectors, e.g in services. This leads to the growth of output and improvement of performance, that is, growth of the economy. However, at the same time, maintaining high employment rates is an important target area of social policy. It cannot be considered an increase of competitiveness if the efficiency of the production is achieved by decreasing wage costs, that is, by dismissals, increased unemployment (as it was the practice with newly restructured companies). As it was mentioned earlier, in measuring competitiveness problems will be encountered if the region has strong external linkages. This is particularly true for nodal regions, where the majority of jobs is in the centre of the region, and the proportion of commuters from without the region is high. Commuters may often come not only from the smaller settlements of the region, but from outside of the region, too. Then it has to be decided which region should account for the income generated by the commuting region, and it is particularly and the population commutes to work, but spends most of the income in the home region. Within the EU several research papers and studies have been prepared about regional differences of development. In these the key components of the competitiveness were defined as: structure of the labour market, the level of education and qualifications, the amount of capital, the amount and quality of agricultural land, infrastructure. The impacts of these factors on the GDP/capital, the net incomes of households, and the volume of exports were established. The competitiveness of cross border regions may be described by the tools introduced above, comparing them to other regions, or to the national level. In the next section a brief summary is given about the main indicators suitable to describe the main characteristics of the region.
38
Figure 1.2: The pyramid model of regional competitiveness. Source: Lengyel, 2000.
1.5 Indicators for assessing and comparing the development of regions Most of the indicators listed below are easily available in general spatial databases, some of them, unfortunately, are available with large gaps, some of them are not published at all in secondary data sources. Thus, the regional comparisons are hindered by the availability of data for some of the relevant regions, the quality and contents of the available data series may differ considerably. Differences may be observed in the lengths, spatial resolutions, levels of aggregation, and even the contents of the data series due to a methodological adjustment in the data collection procedures. Regional databases are published by several international organisations (e.g. UNO, World Bank, etc.) some of the econommic integrations, or private companies (e.g.. De Agostini in Italy, der Fischer Weltalmanach in Germany, etc.), and researchers, research organisations dealing with regional disparities (e.g. public administration and social science institutions). The European Union, in its structural policy, puts great emphasis on the development of regions, the description and explanation of regional 39
development processes. For assessing the development potentials of regions, the following set of indicators are recommended to assess the differences of the development levels of regions.
1.5.1 Development Potential Indicators recommended by the EU As stated above, the development potential of the region is a complex social and economic category exposed to general influences as well as regional specifics. When selecting indicators the following principles may be taken into consideration: •
•
•
•
The final set of indicators should not be too large so as not to compromise the transparency of individual indicators (or groups of indicators) and to facilitate their easy monitoring and evaluation. The final set should be composed of both the significant characteristics of the prerequisites for development of the region – indicators of descriptive nature – descriptors, and the indicators expressing the capacity to utilize these prerequisites. The top priority definitely is the “quality of human potential”. This component of the development potential serves as its active element since its task in the development of regions is not only to utilize the existing prerequisites, but particularly to create and search for new development opportunities. Difficulty in indicator processing arises in those characteristics which as a matter of fact cannot be quantified and thus processed by means of exact methods, but which may only be evaluated verbally or by “values at a predetermined quality scale”. Belonging to these characteristics is e.g. natural environment of the region, historical value – i.e. attractiveness of the region for tourists and the like. When evaluating indicators not “only” their present value (expressed in absolute and relative terms) should be assessed, but it is also of importance to assess the development of indicators (positive, negative) in time.
The selection of indicators to define development potential can be approached in several different ways. Out of the large set of indicators characterizing the situation in regions from a variety of perspectives, for example those indicators may be chosen, which represent for the region: important descriptors and development potential indicators of general validity, region-specific descriptors and indicators of development potential. According to their nature the indicators could be aggregated into ten groups – the so called “ten golden rules of development scenario” (Hrabánková et al., 2006).. Group 1 - General descriptors: It includes characteristics inherent in the region which can be modified to a very limited extent or not at all, though
40
they often strongly contribute to the prosperity or difficulties of the region in question. Group 2 - Economic indicators: Economic characteristics assume a “special position” among the development potential indicators. They may constitute the starting point of further development, at the same time, however, they are its final effect. In other words, they are present both at the beginning and at the very end of development activities. Economic indicators are the ultimate, aggregate indicators of the economic standing of the region and may serve (and do serve) when making interregional comparisons. Group 3 - Regional infrastructure: Economic development of the region is largely influenced by the scope and quality of infrastructure. Without the necessary infrastructure it is hardly possible to ensure not only the development of business activities in the region and outside of it, but also the desired standard of living of its population. Group 4 - Sectoral structure of the region: Ranking among the fundamental characteristics of the region with “national economic” dimension undoubtedly is the sectoral structure of business activities carried out in the region. When drafting the strategy of regional development we may build on the existing structure or to take the road of the desired restructuring, which would promote the economic development of the region. Group 5 - The role of agriculture in the region: In the future too, agriculture shall play a dignified role of a partner to other economic sectors at the lower NUTS levels in particular. Even though it shall not be the staple sector, which it used to be in the past, it shall still have relevant functions to play in rural areas. It is the multifunctional agriculture that the specific indicators forming this group should focus on. Group 6 - Human potential: Of all relevant characteristics influencing the development of the region it is only the human element that can be explicitly perceived as being an active development potential. The human element is a link connecting all the other elements creating possibilities and prerequisites for regional development, and it is an element, which in the end helps achieve the final effects. Regional policy should therefore be focused predominantly on assisting the enhancement of its qualification, creativeness and abilities. This support should be targeted not only at human element as labour force, but should also concentrate on the prerequisites offered and created by the region for the sake of development of human element. Group 7 - Business structure: An important indicator signaling the activity ongoing in the region is the business structure. Business is a “driving force” of economic development and successful business brings benefit not only to owners of businesses but also to the regions, with respect to employment at least (and thus it also has a positive impact on the standard of living of the population), sponsoring of sports and cultural events an the like.
41
The sectoral structure as described in Group 4 could be supplemented with other indicators, related particularly to the size and type of businesses. Group 8 – Environment: Indicators expressing the character and quality of environment are in the forefront of attention of the entire society. It is therefore only appropriate for them to be assigned an adequate weight within the regional development. Quality environment, thanks to the potential tourism activities, may contribute significantly to the development of the region. The damaged environment, on the contrary, signals the urgency of taking measures, which would remedy these negative facts. Group 9 - Region-specific characteristics: As mentioned above, this group contains the characteristics, which often cannot be expressed by a quantitative indicator. These are region-specific characteristics, which are unique to the given region. Group 10 - Development activity: The regional development does not have to be approached by the specific regional policy in the same manner (and it is not the case in practice). Some regions fully tap all the existing development possibilities, both their own prerequisites and financial aid granted by the state - currently this means first and foremost the drawing of support from the EU Structural Funds - other regions implement rather a “sustainable” policy, while yet other regions may be labeled as regions facing difficulties in their development. This is why there is a possibility to accept a group of indicators, which would evaluate the level of involvement of the given region in development activities. When the suitable data series of the needed indicators are collected, the next step is to choose the suitable method to compare them. The next section gives a number of statistical tools that are well fitted to the needs of interregional comparisons and regional analyses.
1.5.2 Indicators for assessing regional differences and changes In the following paragraphs some of the most widely used indices will be described relying on the relevant literature (Lengyel-Rechnitzer, 2004; Nemes-Nagy, 1998; Nemes Nagy, 2005; European Commission, 2004c). Éltetı-Frigyes index (index of duality): D = xm / xa where xm denotes the mean of all xi values above the average of the whole data set, and xa denotes the mean of all xi values below the average of the whole data set. This index compares the mean of the above–average values to the mean of the below–average values. It is simple to compute and clear to understand. 42
This is a widely used indicator – often applied to assess the income inequalities among regions. It is named Éltetı-Frigyes index by Ödön Éltetı and Ervin Frigyes, Hungarian statisticians, who were the first to use it. As an example, the income duality among the regions can be computed as the mean value of the above-average incomes divided by the mean value of the below-average incomes. If the incomes of the regions do not differ, then the index value equals 1, while a value much higher than 1 indicates the existence of a wide income gap between the rich and the poor. The changes of the index by time can show the economic convergence between regions. Robin Hood index: A slightly different measure of inequality is the so-called Robin Hood index. It is computed in the following way: RH = Σi=1..n xi – fi / 2 where xi denotes the share of region i in the total income of the country (Σ i=1…n xi = 100), and f i denotes the share of region i in the total population of the county (Σ i=1…n fi = 100). The resulting value can be interpreted as the proportion of total income needed to be transferred from the rich to the poor to achieve equality, that is the reason for its name. Hoover´s index of inequality: If the same computation is used for variables other than income and population (e.g. x denotes the proportion of industry and f the proportion of labour force), then the generalised index is called Hoover´s index of inequality. Another version of the Hoover-index can be used to measure temporal changes of inequality, when the two distributions are the distributions of the same variable in two different time moment. Krugman’s index of regional specialization: The similarity of industrial specialisation structures across country/region pairs can be captured with a simplified formula of the Robin-Hood index, defined by Krugman. This index is a good example of structural dissimilarity measures of regions, and is often used to compare the labour structures and industrial structures of regions. Balassa’s index: Balassa’s index is used to assess the sectoral structure of a region, usually computed using the output levels (or export levels, etc.), that is, total production (or export) of various sectors in the country and a particular region. B = ( qij/qj ) / ( qi / Q ) where qij denotes the output (or the exported output) by sector i in region j ; qj denotes the total output in region j (thus Σ i=1…n qij = qj ) ; 43
qi denotes the total output of industry i for the assessed macroregion (larger unit, which includes region j), Q denotes the total industrial output for the assessed macroregion (thus Σ j=1…n qj = Q ). The Lorenz curve: The Lorenz curve is the most frequently used chart to describe spatial dispersion. The curve maps the cumulative percentages of one variable against the cumulative percentages of another variable (e.g. the cumulative expenditure share on the vertical axis against the cumulative distribution of the population on the horizontal axis. The chart is a unit square, and if the distribution of the variable plotted by the vertical axis is the same as the distribution of the variable in the horizontal axis, then there is no concentration in the data, and the Lorenz curve is the 45-degree line (the main diagonal axis of the unit square). The larger the distance between the Lorenz curve and the 45-degree line, the more uneven the distribution of the vertical variable and the horizontal variable. In the following example the vertical axis indicates the consumption (or expenditure) of the population, while the horizontal axis indicates the population percentages. Here the 40 percent of the population obtains just under 20 percent of the total consumption, and the 60 percent of the population obtains about 35 percent of the total consumption.
Figure 1.3: The Lorenz – curve. Source: Spiezia (2003) If each individual had the same consumption, or total equality, the Lorenz curve would be the “line of total equality”. If one individual had all the 44
consumption (or income), the Lorenz curve would pass through the points (0,0), (100,0) and (100,100), the “curve of total inequality”.
Notation: Solid line: smaller inequality - Dashed line: larger inequality. Figure 1.4: Variations on the Lorenz-curve. Source: Spiezia (2003) The Gini coefficient: The Gini coefficient is the most commonly used measure of inequality. It is defined as half the average of all pairwise absolute deviations between the observed units (people or regions), relative to the mean income/consumption Its value varies between 0, indicating complete equality, and 1, indicating complete inequality. It measures the extent to which the distribution is “far” from that of total equality. The Gini coefficient is 0 if there is total equality, and 1 if there is total inequality. There is a strong relationship between the Robin Hood index, the Lorenz curve and the Gini coefficient. The Gini coefficient can be related to the Lorenz curve, as it equals the area between the Lorenz curve and the 45 – degree equality line (the dark area in the Figure below) divided by the total area below the 45 – degree line (that is, half of the square).
45
Figure 1.5: The relationships of the Lorenz-curve, the Robin Hood index and the Gini coefficient. Source: Spiezia (2003) In the above figure the Robin Hood index is equivalent to the maximum vertical distance between the Lorenz curve and the 45-degree line of equal incomes (DP). Sen’s index of income inequality: Sen’s index is often used to assess various aspects of poverty and inequality. This is a composite indicator of the weighted averages of the average low income gaps of the poor. It measures the proportion of the population of the region living under the poverty line (low income threshold), the income gap between average income of the poor and the low income threshold, and finally the level of income inequality within the group of the poor. The minimum value is 0, if all the incomes are above the low income threshold and it is equal to 1, if every observation unit owns 0 incomes. (Atkinson, 2003; Förster, 1994). Complex indicators - Human Development Index (HDI): The UN Human Development Index (HDI) is a comparative measure of poverty, literacy, education, and health measured by life expectancy (HDR,1991, 2005). It is a standard means of measuring well-being, used by the United Nations and many other organisations to distinguish whether the assessed area belongs to first, second, or third world. The index was developed in 1990 by Pakistani economist Mahbub ul Haq, and has been 46
used since 1993 by the United Nations Development Programme in its annual Human Development Report. The HDI measures the average achievements in a country in three basic dimensions of human development: • • •
A long and healthy life, as measured by life expectancy at birth. Knowledge, as measured by the adult literacy rate (with two-thirds weight) and the combined primary, secondary, and tertiary gross enrollment ratio (with one-third weight). A decent standard of living, as measured by gross domestic product (GDP) per capita at purchasing power parity (PPP) in USD.
First each component of HDI is transformed into a 0 – 1 index, as a comparison to its possible maximum and minimum values. Then the Human Development Index (HDI) is computed as the average of the three above indices: An HDI below 0.5 represents low development and 30 of the 32 countries in that category are located in Africa, with the exceptions of Haiti and Yemen. The bottom ten countries are all in Africa. The highest-scoring Sub-Saharan country, South Africa, is ranked 120th (with an HDI of 0.658), which is well above most other countries in the region (HDR,2005). In calculating the HDI for regional level the availability of basic data on regional level may cause difficulties, for example, the determination of per capita GDP for a particular region.
47
Chapter 2 - Borderline Location and CrossBorder Cooperation 2.1 The emergence of regionalism, the borderline concept, transboundary cooperation in the European policy 2.1.1 Regions in the EU, the history of European regional policy, regional development disparities 2.1.1.1 The regional structure of Europe Europe is a geographical unity, which, however, does not mean a separate continent, but it is not else than a large western peninsula of Eurasia (Probáld, 2000). Its boundaries are definite in the geographical sense, but these boundaries define a culturally, historically, anthropologically rather mixed, heterogeneous territory. The concept of European-ism can be interpreted, as a consequence, in several different senses, and nowadays this fact often gives rise to debates. To illustrate it, it is enough to remember to the enlargement process of the European Union in the past decades, or the severe debates encountered during the preparation of the European Constitution, which try to define the concept of Europe and European citizenship according to historical, cultural and religious identities, with not much success. The peoples of Europe are more or less linked by common historical roots, and European identity is strongly related to the European culture and Christian religion. At the same time, there are large differences in culture between North and South, East and West, and religious identities may be questioned on the grounds of differences between Catholic, Protestant and Orthodox lines, not mentioning the considerable Islamic communities living in several countries of Europe. Common history often means the history of conflicts, hostilities, war against each other, which are as typical of European history as the struggles against external (e.g. Turkish or Tartar) conquerors. The areas of the modern European nation states have been outlined during such wars against the neighbours, and even nowadays have been the roots of ethnic conflicts. On top of that, no other continent has such variety of linguistic, ethnic, and anthropological types as Europe. During the recent enlargements of the EU the issue of belonging to Europe, and therefore potentially to the EU in the future, has been raised several times. Let us just remember the desire of Turkey to enter the EU, and the response of the Union to the idea, or the debates and discussions the Turkish application generated. Similar questions may be raised with regard to the accession of Ukraine or Russia, considering their European and Asian 48
characteristics, although in the geographical respect their areas (or at least a large proportion of them) definitely lie in the territory of Europe. In 1996 Terry Jordan, a researcher at the University of Texas identified 11 traits which may be used to define European identity (Probáld, 2000): 1, religion (at least 80 % of the population is of the Christian religion) 2, language (at least 80 % speaks an indoeuropean language as mother tongue) 3, anthropological features (at least 90 % is Caucasian) 4, health (infant mortality is lower than 1 for a thousand births) 5, developed economy (GDP/head is at least 10 000 USD) 6, education (the proportion of analphabetic population is at most 10 %) 7, developed transportation infrastructure (road density is at least 400 km/100 km2) 8, high employment in the secondary and tertiary sectors (the proportion of wage earners in agriculture is not more than 15 %) 9, high level of urbanisation (the proportion of urban population is at least 50 %) 10, stable population (natural growth rate is not more than 1 %) 11, parliamentary democracy since at least 1980. In the European countries the number of the above traits is between 0 and 11. In West-Europe typical values are above 8, for Portugal, Spain, Greece and Central and Eastern Europe 5 to 7, while in the Balkans, in Serbia and Montenegro 4 traits hold, and for Turkey and Albania only 3 or less. In spite of all these varieties and heterogeneity the probably most characteristic feature of European history nowadays is the desire to develop integration, for which the history of the European Union gives a good example. In the 1990-es after the transition, several countries separated in Central and Eastern Europe, because the need to define national identity within the framework of independent nation states started the process of establishing sovereign states, but by now the majority of even these countries see their future progress within the framework of the European Union, in close cooperation with the other European states. Integration, the development within the same framework, is a recognised and accepted interest and intention for the vast majority of the European countries, which, from time to time gives rise to debates and conflicts of opinion, but still relies on principles accepted and respected by all. One of these principles is the harmonised and balanced development and welfare for all the peoples of Europe, which also means the decrease of the differences in the quality of life among countries and regions, and this requires the implementation of the solidarity principle, for which the richer and better developed countries by the greater burdens should contribute to a larger extent. The population of Europe is higher than 700 million persons, which is about 12 % of the world population. Up to the industrial revolution the population grew by a slow and steady rate, then, until the 20th century a fast growth 49
followed, then, from the middle of the past century the growth seems to have stopped. Nowadays – at least in the Western part of Europe – the number of births keeps decreasing, the population gets older and this tendency has appeared in Central and Eastern Europe as well. There is a specific North-South division, in the Southern countries the birth rate is still higher than in the North, and the population is somewhat younger. Considering life expectancy there is another division, between East and West. The life expectancy for women and men is higher than 76 years, while in Central and Eastern Europe men can expect less than 75 years, women can expect a little more than 75 years. These facts reflect the considerable differences of welfare, incomes and quality of life in Europe. More than 75 % of the population, and in West-Europe about 80 % lives in towns and cities. The economy of Europe is currently the second in the world behind the USA. While at the turn of the 19th and the 20th centuries it was the leading industrial power of the world producing 62 % of the manufacturing sector, nowadays the tertiary, service sector is the most important sector of the economy. Its share in employment and GDP is about 60 %, the share of the industrial sector is around 30 to 33 %, while the share of agriculture is less than 10 % for the GDP and about 10 % for employment. Besides the tertiary sector, that is, traditional services as transport and trade, commerce, increasingly important is the role of the quarternary sector in the economy of Europe, that is, the financial, informatical, educational and researchdevelopment activities based on high technology. The European transportation network contains the densest road network in the world, and it is particularly developed in the North-East direction. The motorway network is also dense, as well as the pipeline commercial transportation and the dense network of airports. The road transport has become overcrowded by now, but the railway and water traffic enjoys a revival, especially in the transportation of commodities. The administrative structure of Europe is characterised by four basic types, which are closely related to the historical development of the nation states. According to the relationship between the state and the administrative level immediately below, the following basic types may be identified (Horváth, 1998a; 1998b): •
•
•
Federalist states: e.g. Germany, Austria, Belgium, Switzerland – the autonomy of provinces, cantons is wide, they have state-level institutions and functions in many respects, they have parliament and government of their own. Autonomy is the decisive historical tradition. Regionalised countries: Italy, Spain – the autonomy of the middle level governance is limited, the central administration decides about division of financial resources. The regions are defined by the central government, the legislative, and budgetary authority of the regions is rather limited. Decentralised states: France, Portugal – the regional administration is placed between the local governments and the central authorities, the role of the regions is wider than that of the local level and narrower than that of the central level. This type is rather similar to the former one. 50
•
Unitary states: Greece, Finland, Denmark, The Netherlands, Ireland, the United Kingdom – the middle level administrative units are strictly directed by the central administration, their budget and financial resources, as well as legislation is determined by the central goverment. This heavily centralised administration is typical also for Central and Eastern Europe, and for the majority of the Southern European countries.
Europe shows a wide range of differences in its history as well as in its natural resources. Regarding its social and economic aspects large disparities exist, and the most significant dividing line lies at the Eastern frontiers. For all of the EU-15 countries the average GDP per person is above 10 thousand USD, but this is not true for the newly accessed countries of the 2004 enlargement (the only exception is Slovenia, which has already reached the development level of the old member states), and even less for the two newest members, Romania and Bulgaria, with average GDP/head levels at only about 30% of the EU-25. Another division by the quality of life exists at the border between the newly accessed Central and Eastern European countries and the countries of the Community of Independent States (CIS), and towards the Balkans. The inequalities are somewhat less marked if the GDP is calculated on the Purchasing Power Parity basis, but even with this method there are large differences of 20 times, that is, the richest country has a GDP level 20 times higher than the poorest countries. Considerable developmental inequalities exist even in the rich western half of Europe. Some of the regions stand out and work as economic decision makers, and they act as economic power centres, having large population numbers and densities, high incomes and for these locations the concentration of businesses. R. Brunet (1989, cited by Probáld, 2000, p.121) introduced the folowing names for the central and core regions in Europe: Blue Banana: this is a banana shaped highly urbanised area from South East England, to Northern Italy through the Benelux states, and the Rhine valley. This area is characterised by great population density, and large industrial areas. Recently the role of industrial activities have decreased, but the large banks of high capital resources, the transnational corporate centres, the traffic nodes (largest airports) and the centres of international political decision making are also located here. Within this area an outstanding role is played by the so-called Central Triangle, the area of London – Paris – Ruhr – area, which is the traditional centre, core zone of the continent. Dynamic development is experienced by the shores of the Mediterranean, in the so-called sunbelt, that is, in the triangle of Barcelona-Lyon-Bologna. Here the leading sectors are the service sector, tourism, the creative industries, as design, and instead of the Fordist mass production the importance of small and medium size enterprises, serving the individualistic needs of the consumers, is remarkable in the economy of the region. 51
Development axes can be identifyed by the main traffic channels, which are the main roads of the diffusion of innovation and economic dynamism. Since the transition of 1990, dynamic progress is experienced in the western borderline areas of the former socialist countries, in large towns and cities equipped with modern infrastructura and capable of absorbing innovations. Similarly to the „blue banana” concept the area of Gdansk-Prague Batislava-Gyır-Budapest is often referred to as „yellow boomerang” and considered to be a development axis in the region.
Blue Banana
Central Triangle Development axes
Yellow Boomerang
Sunbelt Figure 2.1: The core regions in Europe. Source: authors’ own construction based on Probáld (2000).
2.1.1.2 Regional policy in the EU The European Union is one of the most prosperous economic zones in the world. Since the accession of 10 new Member States on 1 May 2004, it has the power of an internal market and the human potential of more than 450 52
million citizens. But economic and social disparities among its Member States and among its regions weaken its dynamism overall. These disparities are twice as great in the Europe of the Twenty-five, with its 254 regions, than they were in the Europe of the Fifteen. Following the accession of Romania and Bulgaria in January 2007 these inequalities have increased even further. Disparities Disparities in revenue and employment have declined in the European Union as a whole during the past 10 years and in particular since the mid-1990s. Between 1994 and 2001, in the ‘Cohesion Fund countries’ , even if one excludes Ireland, which experienced exceptional development, the increase in the GDP per head has surpassed by 1 % per year the average of the Union, and in all these countries — with the exception of Greece — the proportion of the population of working age that holds a job has increased significantly more quickly than the average. These disparities have grown since the accession of the new Member States in 2004, however. While the GDP of the Twenty-five has only grown by 5 % by comparison with that of the Fifteen, the average GDP per head in the new countries acceding to the Union is less than half of the current average in the Union and only 56 % of the population of working age holds a job, as compared to 64 % in the Union of the Fifteen. Objective 1 of the Structural Funds (economic development of the least advantaged regions) involves the entire territory of the new Member States and almost 98 % of their population, of whom two thirds live in regions with GDP per head of less than half the average GDP of the Twenty-five. With respect to employment, unemployment rates (2002 data) vary greatly within the Twenty-five: from 2 % in Tyrol (Austria) and 3.3 % in Cyprus to 29 % on Réunion Island (France) and 26.3 % in the Lubuskie region (Poland). Outside the most disadvantaged regions, many regions and cities find themselves in an intermediate situation with areas in which serious economic and social difficulties accumulate (European Commission, 2004c).
Figure 2.2: The differences in GDP per head in the EU. Source: European Commission 2004b, 2004c. 53
The reason for regional policy: Solidarity Employment, training, the competitiveness of firms, investment in infrastructure, the information society, research, and the quality of the environment are all primarily the responsibility of authorities and economic operators in each Member State and region. But not only …
Figure 2.3: Regional income disparities in the EU. Source: European Commission 2004b, 2004c. 54
European solidarity is in fact already mentioned in the preamble of the Treaty on European Union. The Treaty specifies that the Community acts to strengthen its economic and social cohesion and specifically to reduce the gaps among levels of development in the various regions. This is why the Member States participate in a European regional policy co-financed by the European funds, Structural Funds and Cohesion Fund, which embody Community solidarity. This policy plays more than just a financial role, however. Its goal is not simply to redistribute resources but rather to create new ones by investing in the potential of the regions and their communities. It also seeks to bring ‘added value’ to development activities, more specifically, the European dimension. In other words, to support joint consideration and action and promote a European model of regional development: this is where opportunity lies for the regions of Europe in an increasingly global world. We see from experience that regional policy can only be effective when it concentrates its action on a limited number of sufficiently large territories. This is why the regulations of the Structural Funds adopted in 1999 responded to the concern to reduce the small number of assistance programmes and clarify the criteria for the selection of the regions with the greatest need of public support for development. Furthermore, a portion of the Structural Funds is set aside for disadvantaged social groups over the entire territory of the Union without particular geographical criteria. Structural policy in the period 2000-2006 For the period between 2000 and 2006, EUR 213 billion has been earmarked for all structural instruments for the 15 Member States. In addition, about EUR 22 billion in preaccession aid, and another EUR 22 billion in structural interventions for the new Member States in the period 2004–06, will be spent within the Union’s adjusted financial perspectives. The total of about EUR 257 billion represents approximately 37 % of the EU budget for the period up to 2006. Most of the funding is being spent through multiannual development programmes, managed jointly by Commission services, the Member States and regional authorities. The European subsidies do not replace but rather supplement national aid. The Structural Funds Each of the four existing Structural Funds has had its own specific thematic area. The European Regional Development Fund (ERDF) has financed infrastructure, job-creating investment, local development projects and aid for small firms. The European Social Fund (ESF) has promoted the return of the unemployed and disadvantaged groups to the workforce, mainly by financing training measures and systems of recruitment assistance. The Financial Instrument for Fisheries Guidance (FIFG) helped to adapt and modernise the fishing industry. The Guidance Section of the European Agricultural Guidance and Guarantee Fund (EAGGF-Guidance) financed rural development measures and provided aid for farmers, mainly in regions 55
lagging behind in their development. Other financial instruments has existed in addition to these Structural Funds, including notably the Cohesion Fund (European Commission, 2004c). The priority objectives in 2000-2006 To enhance its impact and secure the best possible results, 94 % of structural funding for the period 2000–06 was concentrated on three objectives in the programming period 2000-2006 (European Commission, 2004c).. - Objective 1: Helping regions whose development is lagging behind to catch up. - Objective 2: Supporting economic and social conversion in industrial, rural, urban or fisheries dependent areas facing structural difficulties. - Objective 3: Modernising systems of training and promoting employment. Measures financed by Objective 3 covered the whole Union except for the Objective 1 regions, where measures for training and employment were included in the catch-up programmes. The disadvantaged regions: Taken together, the disadvantaged regions (Objectives 1 and 2) have been home to some 225 million inhabitants, or almost 50 % of the population of the Union of the Twenty-five. The less-developed regions (Objective 1) Objective 1 involved those regions in which GDP per head did not reach 75 % of the average for the Union. The regions covered by this objective in the Europe of the Fifteen exceeded the 75 % level of the average GDP of the Twenty-five after 2004, by simple statistics. They nonetheless remained just as much beneficiaries in the 2004–2006 programming period. In addition to these regions, Objective 1 covered the entire territory of the new Member States with the exception of Bratislava, Prague and Cyprus, which received aid under Objectives 2 and 3. It also covered regions with very low population density (fewer than eight inhabitants per square kilometre) in Finland and Sweden and the regions on the extreme periphery (the French overseas departments, the Canary Islands, the Azores and Madeira). Certain Swedish coastal areas, as well as Northern Ireland and the counties on the border of the Republic of Ireland received aid within this objective. The areas undergoing economic and social restructuring (Objective 2) The four types of area in Objective 2 were facing the following difficulties: - changes in the key sectors and decline of employment in the areas of industrial activity and services; - a situation of economic and social crisis and the deterioration of neighbourhoods in the urban areas; - a decline of traditional activities and depopulation of rural areas; 56
-
a crisis due to the decline of employment in the fisheries sector in areas that depend economically on fishing.
Individuals in difficulty on the employment market (Objective 3) This objective was aimed at dealing with employment and human resources targets to help unemployed young people, underqualified workers, the longterm unemployed and all those individuals facing inequalities of access to employment and training. The supported target group included all social categories at risk on the employment market for reasons involving discrimination associated with gender, race or ethnic origin, religion, a physical or mental disability, age or sexual orientation. Individuals were entitled to receive assistance in disadvantaged or prosperous regions alike. Community initiatives Besides the three priority objectives the EU provided specific support for four community initiatives to find solutions to problems common to a number of, or all Member States and regions: INTERREG III for the development of crossborder, interregional and transnational cooperation; URBAN II to support innovative strategies in cities and urban neighbourhoods; LEADER+ to promote rural development initiatives; EQUAL to combat discrimination in the labour market. The Community initiatives absorbed 5.35 % of the Structural Funds budget. Interregional cooperation Numerous territorial communities have taken part in crossborder, transnational and interregional cooperative activities co-financed by the INTERREG III Community initiative, in one of the following forms: - Cross-border cooperation involved regions located on both sides of a land or maritime border. Their situations varied: some have been prosperous; others have been included among the most impoverished and possessed the least infrastructure. They have had in common the fact that for a very long time certain neighbouring regions were unaccustomed to work together. This resulted in a loss of resources as a result for example of the duplication of infrastructure and a series of inconsistencies in the areas of transportation, energy and social mobility. Crossborder cooperation has gained growing significance with European integration, both on the Union’s external and internal borders. - Transnational cooperation involved large groups of regions including regions located outside the Union, which revealed common territorial characteristics. These groupings may have overlapped. Thirteen groupings of regions have been defined in this way such as the western Mediterranean, the Alpine region, Cadses (central Europe, Adriatic, Danube and south-eastern Europe) and the Caribbean area. All European regions could take part in this kind of cooperation. 57
-
Interregional cooperation linked territorial communities by various criteria regardless of the region of the Union they occupy and even beyond the borders of the Union, the regions involved in the cooperation were not necessarily contiguous.
The Cohesion Fund The Cohesion Fund was designed to assist the least prosperous countries of the Union: it has provided support for the new Member States, Greece, Portugal and Spain, as well as Ireland (until the end of 2003), to co-finance major projects involving the environment and trans-European transportation networks. The criterion for support is that the country’s gross national product (GNP) is not higher than 90 % of the average for the Union. The Cohesion Fund has intervened throughout the national territory, to avoid having the cost of these works disrupt budgetary efforts in the countries to satisfy the demands of economic and monetary union. Pre-accession aid For the first time in the history of its progressive enlargements, the European Union has provided pre-accession aid for the 10 central and east European countries, of which eight became members in 2004 (Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia), the other two, Bulgaria and Romania accessed in 2007. This aid continues to be offered to candidate countries, although in a somewhat modified structure. The 2007-2013 programming period The European Union’s regional and cohesion policy will have to meet four challenges during the 2007–13 programming period (European Commission,2004b; 2004c): •
Increase cohesion in an enlarged Union The enlargement of the Union to 25, then to 27 Member States has presented an unprecedented challenge for the competitiveness and internal cohesion of the Union. Enlargement will lead to the widening of the economic development gap, a geographical shift in the problem of disparities towards the east and a more difficult employment situation: socioeconomic disparities will double and the average GDP of the Union will decrease by 12.5 %. At the same time, the whole of the Union faces challenges arising from a likely acceleration in economic restructuring as a result of globalisation, trade opening, the technological revolution, the development of the knowledge economy and society, an ageing population and a growth in immigration. The Union should fully exploit the opportunities provided by the current trend towards recovery as a springboard to the future. 58
•
Strengthen the Union’s priorities In an effort to improve the performance of the EU economy, the Heads of State or Government of the Union meeting in Lisbon in March 2000 set out a strategy designed to make Europe the most successful and competitive knowledge-based economy in the world by 2010. The Nice Council in December 2000 translated the Lisbon objectives on poverty reduction into a coordinated EU strategy for social inclusion. At the Gothenburg Council in June 2001, the Lisbon strategy was widened, adding a new emphasis on protecting the environment and achieving a more sustainable pattern of development. Cohesion policy is also necessary in a situation where other Community policies have important benefits with limited costs, although in a localised way. Cohesion policy helps to spread the benefits. By anticipating change and facilitating adaptation, cohesion policy needs to incorporate the Lisbon and Gothenburg objectives and to become a key vehicle for their development via the national and regional development programmes.
•
Improve quality to promote sustainable and more balanced development Strengthening regional competitiveness through well targeted investment throughout the Union and providing economic opportunities which help people fulfil their capabilities will thus underpin the growth potential of the EU economy as a whole to the common benefit of all. By securing a more balanced spread of economic activity across the Union, regional policy helps to reduce the pressures of over-concentration, congestion and bottlenecks.
•
Create a new partnership for cohesion The reform of the cohesion policy should also provide an opportunity to bring greater efficiency, transparency and political accountability. This requires, first and foremost, the definition of a strategic approach for the policy, spelling out its priorities, ensuring coordination with the system of economic and social governance and allowing for a regular, open review of progress made. The corollary to the above is the need to reinforce institutional capacities at all levels of government throughout the Union, building on one of the key strengths of cohesion policy.
Priorities for the 2007-2013 period: convergence, competitiveness, cooperation On 18 February 2004, the European Commission adopted ‘A new partnership for cohesion in the enlarged Union: convergence, competitiveness cooperation’, the third report on economic and social cohesion, in which it describes its vision of the cohesion policy for the period 2007–13. On the basis of the budget proposal presented by the Commission on 10 February 2004, a little more than EUR 336 billion was to be allocated to the cohesion policy for the new period, with the priorities indicated below (European Commission, 2004a):
59
2000-2006 Objectives Cohesion Fund Objective 1
Objective 2 Objective 3
INTERREG URBAN EQUAL LEADER+ Rural development and the restructuring of the fisheries sector outside Objective 1 Nine objectives
2007-2013 Financial instruments Cohesion Fund ERDF ESF EAGGFGuidance FIFG ERDF ESF ESF
ERDF ERDF ESF EAGGFGuidance EAGGFGuarantee FIFG
Objectives
Convergence and competitiveness
Regional competitiveness and employment - regional level - national level: European employment strategy
Financial instruments Cohesion fund ERDF ESF
ERDF ESF
ERDF European Territorial Cooperation
Six instruments
Three objectives
Three instruments
Figure 2.4: Instruments and objectives of the Structural Funds in 20002006 and 2007-2013. Source: European Commission, 2004c -
Priority 1: Convergence: support employment growth and job creation in the Member States and least developed regions
This objective involves primarily the regions in which GDP per inhabitant is less than 75 % of the Community average. At the same time, to counter the ‘statistical effect’ associated with the enlargement, temporary support is proposed for the regions in which GDP per inhabitant would have been less than 75 % of the Community average calculated for the European Union of the Fifteen. The modernisation and diversification of the economic structure, development and modernisation of basic infrastructure, environmental protection, strengthening of administrative capacity, improvement of the quality of labour market institutions and of education and training systems, and development of human resources will be the principal themes for which co-financing is available to the national and regional programmes. Furthermore, Member States whose gross domestic product is less than 90 % of the Community average will be eligible for the Cohesion Fund, which will continue to finance programmes in the areas of transportation and the environment.
Priority 2: Regional competitiveness and employment: anticipate and encourage the change The cohesion policy outside the most disadvantaged Member States and regions will have two fundamental objectives. First, the cohesion policy will use the regional programmes to assist regions and regional authorities to anticipate and promote economic change in industrial, urban and rural areas and to strengthen their competitiveness and attractiveness, taking existing economic, social and territorial disparities into account. Secondly, the cohesion policy will use national programmes -
60
to assist people in preparing and adapting to economic development, in line with the priorities established in the European strategy for employment by supporting policies targeting full employment, the quality and productivity of work and social integration. Priority 3: European territorial cooperation: ensure harmonious and balanced development throughout the entire Union On the basis of the experience acquired in the INTERREG initiative, this objective is aimed at supporting cooperation for the whole territory of the EU at cross-border, transnational and interregional level. The support would be available in principle for all regions adjacent to internal or external land or maritime borders. This involves essentially the search for common solutions to common problems by means of cooperation among the responsible authorities of neighbouring bodies involved in such areas as the development of urban, rural and coastal areas, strengthening economic relations and networking small and medium-size enterprises.
-
The main development stages of the European regional policy 1957 The countries signing the Treaty of Rome refer in its preamble to the need ‘to strengthen the unity of their economies and to ensure their harmonious development by reducing the differences existing among the various regions and the backwardness of the less-favoured regions’. 1958 Setting-up of two sector-based funds: the European Social Fund (ESF) and the European Agricultural Guidance and Guarantee Fund (EAGGF). 1975 Creation of the European Regional Development Fund (ERDF) to redistribute part of the Member States’ budget contributions to the poorest regions. 1986 The Single European Act lays the basis for a genuine cohesion policy designed to offset the burden of the single market for the southern countries and other less-favoured regions. 1989–93 The European Council in Brussels in February 1988 overhauls the operation of the Solidarity Funds (now referred to as the Structural Funds) and allocates ECU 68 billion to them (at 1997 prices). 1992 The Treaty of the European Union, which came into force in 1993, designates cohesion as one of the main objectives of the Union, alongside economic and monetary union and the single market. It also establishes the creation of the Cohesion Fund to support projects in the fields of the environment and transport in the least prosperous Member States. 1994–99 The Edinburgh European Council (December 1993) allocates almost 200 billion ECU (at 1997 prices), one third of the Community budget, to cohesion policy. Alongside the Structural Funds, a new Financial Instrument for Fisheries Guidance (FIFG) is created. The Berlin European Council (March 1999) reforms the Structural Funds and adjusts the operation of the Cohesion Fund. These funds will receive over EUR 30 billion per year between 2000 and 2006, i.e. EUR 213 billion over seven years. The Instrument for Structural 61
Policies for Pre-accession (ISPA) and the Special Accession Programme for Agriculture and Rural Development (Sapard) complements the Phare programme that has been in existence for seven years to promote economic and social development and environmental protection in the applicant countries in central and eastern Europe. 2000–01 The European Council in Lisbon (March 2000) adopts a strategy focused on employment and designed to make the Union ‘the most competitive and dynamic knowledge-based economy in the world by the year”. 2001 The Gothenburg Council (June 2001) completed this strategy by linking it with sustainable development. 2002 The European Council in Copenhagen (December 2002) leads to an agreement on the conditions for the accesion of 10 new Member States to the Union. 2004 On 18 February, the European Commission presents its proposals for the reform of cohesion policy for the period 2007–13: ‘A new partnership for cohesion: convergence, competitiveness, cooperation’. On 1 May, accession to the European Union of Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia (European Commission, 2004c).
2.1.1.3 The system of territorial classification for regions in the EU The Nomenclature of Territorial Units for Statistics (NUTS) was established by Eurostat more than 25 years ago in order to provide a single uniform breakdown of territorial units for the production of regional statistics for the European Union (EUROSTAT, 2006). The NUTS classification has been used since 1988 in Community legislation. However, it was not until 2003, after 3 years of preparation, that a Regulation of the European Parliament and of the Council on the NUTS was adopted. From 1 May 2004, the regions in the 10 new Member States have been added to the NUTS, then Bulgaria and Romania in January 2007. A particularly important goal of the Regulation is to manage the inevitable process of change in the administrative structures of Member States in the smoothest possible way, so as to minimise the impact of such changes on the availability and comparability of regional statistics. Enlargements of the Union will render this objective all the more vital. The NUTS nomenclature was created and developed according to the following principles (EUROSTAT, 2006): •
The NUTS favours institutional breakdowns. Different criteria may be used in subdividing national territory into regions. These are normally split between normative and analytic criteria: - normative regions are the expression of a political will; their limits are fixed according to the tasks allocated to the territorial communities, according to the sizes of population necessary to carry out these tasks efficiently and economically, and according to historical, cultural and other factors; - analytical (or functional) regions are defined according to analytical requirements; they group together zones using geographical criteria 62
(e.g., altitude or type of soil) or using socio-economic criteria (e.g., homogeneity, complementarity or polarity of regional economies). For practical reasons to do with data availability and the implementation of regional policies, the NUTS nomenclature is based primarily on the institutional divisions currently in force in the Member States (normative criteria). •
The NUTS favours regional units of a general character. Territorial units specific to certain fields of activity (mining regions, rail traffic regions, farming regions, labour-market regions, etc.) may sometimes be used in certain Member States. NUTS excludes specific territorial units and local units in favour of regional units of a general nature.
•
The NUTS is a three-level hierarchical classification Since this is a hierarchical classification, the NUTS subdivides each Member State into a whole number of NUTS I regions, each of which is in turn subdivided into a whole number of NUTS II regions and so on. At the regional level (without taking the municipalities into account), the administrative structure of the Member States generally comprises two main regional levels (Länder and Kreise in Germany, régions and départements in France, Comunidades autonomas and provincias in Spain, regioni and provincie in Italy, etc.). The grouping together of comparable units at each NUTS level involves establishing, for each Member State, an additional regional level to the two main levels referred to above. This additional level therefore corresponds to a less important or even non-existent administrative structure, and its classification level varies within the first 3 levels of the NUTS, depending entirely on the Member State: NUTS I for France, Italy, Greece, and Spain, NUTS II for Germany, NUTS III for Belgium, etc.
The NUTS Regulation lays down the following minimum and maximum thresholds for the average size of the NUTS regions. Table 2.1: The levels of the NUTS system Level Minimum NUTS I 3 million NUTS II 800 000 NUTS III 150 000 Source: Eurostat, 2006.
Maximum 7 million 3 million 800 000
At a more detailed level, there are the districts and municipalities. These are called "Local Administrative Units" (LAU) and are not subject of the NUTS Regulation. It is though foreseen in the Regulation that after two years the Commission will publish a report on the feasibility to extend the NUTS breakdown to a fourth level. 63
Levels of the classification system There are three levels of NUTS defined, with two levels of local administrative units (LAUs) below that, historically called NUTS levels IV and V and sometimes still described as such. Note that not all countries have every level of division. Luxembourg, for example, has only LAUs; the three NUTS divisions each correspond to the entire country itself. Table 2.2: The number of NUTS units in the EU Countries
Country code NUTS I
NUTS II
NUTS III
AT BE DK FI FR
3
9
35
3
10
43
1
1
15
2
5
20
9
26
100
16
41
439
4
13
51
1
2
8
5
20
110
1
1
1
4
12
40
3
7
32
7
19
52
Sweden
DE GR IE IT LU NL PT ES SE
1
8
21
United Kingdom
UK
12
37
133
72
214
1098
1
1
1
1
8
14
1
1
5
3
7
20
1
1
6
1
1
10
1
1
2
6
16
45
1
4
8
1
1
12
89
255
1221
2
6
28
1
8
42
Austria Belgium Denmark Finland France 2Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain
EU-15 Cyprus Czech Republic Estonia Hungary Latvia Lithuania Malta Poland Slovakia Slovenia
CY CZ EE HU LV LT MT PL SK SI
EU-25 Bulgaria Romania
BG RO
Source: Eurostat, 2006.
64
Structural Funds has offered calls for proposals for projects by NUTS II and NUTS III level regions. The EU allowed, as an exception, for the newly accessed countries of the 2004 enlargement, to prepare and propose their development programme for the NUTS 0, that is, the country level (up to 2006).
2.1.1.4 Results of the regional policy of the European Union The most important lesson to be learned by the evolution of the regional policy of many decades has become the organic part of European thinking. The idea of solidarity has become the starting point of the national and sectoral policies of the nation states, the cohesion strategy of the EU and the related community actions. The cohesion model means the diminishing of the economic disparities of regions and social groups, that is, the involvement of increasingly wide strata of the population in the creation of growth preconditions and in the utilisation of its results. The social dimension of cohesion means maintaining the highest possible level of employment, improving the employability of disadvantaged groups of the society, and diminishing the level of unemployment. And finally in the everyday political practice cohesion is a way of expression of the mutual support within the state and within the European community, which is not simply a transfer of incomes, but also the joint action for using the best methods and measures to enhance the optimal utilisation of internal resources. Regional inequalities are a barrier for economic development, hinder the strengthening of competitiveness, create social tensions and prevent the establishment of the unified Europe. The economic policy of several European nations have targeted at decreasing spatial disparities by various measures. To improve the cohesion in Europe the national regional policies have contributed only to a slight extent, and this is the reason why the diminishing of territorial inequalities has become one of the most emphasised strategic objectives of the EU. The European Commission published its first cohesion report in 1996 (European Commission,1996). The four main issues discussed in the document are the following (European Commission,1999): •
• • •
Have the social and economic disparities decreased among the member states, the regions and the social strata of the population after the implementation of the harmonious development objectives of the European Union? What roles have the member states played in the achievements of the objectives? How have the other policies of the EU assisted the achievements of the cohesion objective? What impacts have the measures of the structural policy had?
The Cohesion Report has stated that in the period of 1983-1995 the income disparities among the member states have decreased, most of all for the reason, that the four countries subject to the Cohesion Fund support (Greece, Ireland, Portugal and Spain) have achieved an increased 65
development rate. The disparities of the regions, however, have remained basically the same. The differences of the most developed and the least developed regions have decreased only to a slight extent in comparison with the difference in the decade of 1980. The GDP/person value of the richest region (Hamburg Land in Germany) of the EU-15 was 4.7 times as high as that of the poorest region (Azores in Portugal) in 1983, and this proportion changed to 4.5 in 1993. The most developed 25 regions and the least developed 25 regions have maintained exactly the same regions of the EU-15 now. The second cohesion report of the European Commission published in 2001 declared, that the cohesion policy of the EU has achieved notable results in the period of 1989-1999 (European Commission,1999). The underdeveloped regions have shown signs of economic and social catch-up. In spite of that, the member states – and especially the regions – still show considerable income differences. Similar conclusions are found in the third cohesion report of the union published in 2004. The performances and capacities of the regions are mainly determined by their activities, sectoral structures. The GDP values in the agricultural regions of the four cohesion countries and Finland are well below the EU average, and the growth rates of incomes are much smaller. The industrial regions – in Germany, Northern Spain, Northern France, Northern Italy, the British midlands, and Austria – show above average performance, but the growth rates are rather moderate. Areas with strong tertiary sectors – that is, all the regions of the capitals of the member states except Lisbon, the areas of Northern Germany, the Netherlans and Belgium – have the highest GDP values, the growth rates area about the average (Horváth, 2004). The economic activities are excessively concentrated into the highly urbanised regions. The dynamic growth of the large cities has further increased the regional income disparities in the majority of the cohesion countries. The reasons for the development of territorial disparities are – besides settlement structure and the structure of the economy – explained by productivity and employment-related factors. The higher the productivity rate of a region (that is, the GDP/employee) and the employment rate, the higher the value of GDP/person in the region. The impacts of these two factors, however, are different in the member states. In Germany and Italy, with their dual regional economies, the two components, and their combination show large extremes by regions. The cohesion countries are also varied: in Spain and in Ireland the productivity is near the EU average, but the employment rate is much lower. In Greece and in Portugal, the low unemployment figures go together with low levels of productivity. The decrease in the productivity levels has to be achieved under completely different circumstances in the various areas in the EU. In the richest regions 66
the conditions of modern telecommunications, well trained labour force, developed research and development infrastructure are a lot more favourable than in the poorer areas. These differences are notable also in the road and rail networks, as the density of Southern motorways is below the 50 % of the EU average. The preparation of the 2000-2006 budgetary period and the planned enlargements of the EU created large changes in the measures of structural policy. The Commission announced the document Agenda 2000 in July 1997, which declared the objectives for a stronger and wider union in the first decade of the next century. This document declared social and economic cohesion as the first priority. The resources of structural policy were recommended to be increased from the annual 26 billion EUR of the 1994-1999 period to 39 billion EUR per year for the following budgetary period. Of the total resources of 275 billion EUR for structural support 45 billion EUR was allocated for the newly accessed states. In the Berlin summit in 1999 the accepted community budget, however, contained more moderate structural policy resources, namely the total of 213 billion EUR was allocated for the 15 old member states. The proportions of various structural measures remained the same as in the former budgetary period. The enlargement of the EU has created a considerable change. The currently 27 members show twice as high income disparities as they used to be in the 15 old member states. In the spring of 2004 one sixth of the population of the 15 member states had their incomes below 90 % of the EU average. After the enlargement one third of the total population belonged to this category. The average GDP of the poorest 10 % of the population of the 15 old countries is 61 % of the EU average, the same proportion for the 27 countries is only 31 %. Enlargement increases income disparities in the Union in two ways. First it doubles the proportion of people living in regions with average incomes below 75 % of the EU average. Secondly it increases the sizes of the income differences. A new challenge for cohesion policy is that the 12 new members need infrastructural investments of 90 billion EUR, and they need another 50 to 100 billion EUR for the necessary improvement of their environmental conditions. Cohesion policy has achieved results in job creation, too. In the 1990-es 2 million new jobs were created in the 15 member states. However, it was not sufficient to provide employment for 70 % of the working age population, although this is the targeted proportion defined by the Lisbon summit for 2010. Disparities of countries are high in this area, too. There are four member states, where more than 70 % of the working age population works, but in Greece this proportion is only 55 %, in Spain and Italy it is even lower. Although female employment has increased – mainly in part-time jobs – but its proportion is still 19 % lower than that of men.
67
The inequalities in the unemployment rates do not decrease. The unemployment rates are above 10 % in Greece, Spain, France and Italy, and this value is at least twice as high as the less than 5 % rate in Luxembourg, the Netherlands, Austria and Portugal. The third cohesion report contained a new, essential target area, that is, the priority of supporting transboundary cooperation and borderline regions. For the new member states the main source of support is Objective 1, thus for them it is not the actual financial support available under Objective 3 is the most important, but the principle itself, which brings borderline regions into focus and make decentralised cooperation a priority. To erase underdevelopment, and to enhance the development of regions are among the most important strategic aims of the European Union, and nearly 40 % of the European budget is allocated to this aim. To develop underdeveloped areas, the member states and their regions receive considerable amounts, depending on their actual level of development, from the EU funds. At the same time, in spite of the considerable amounts spend on diminishing these disparities, changes in the ranking of regions have occurred only if the member states applied strict long-term structural policy rules for utilising EU resources throughout several decades. Successful regions, in their development strategies did not focus on the development of traditional infrastructural components, but they focused on the modern driving forces of spatial development (innovation, business services, modern industrial organisation, human resources development). Regions relying entirely on the support policy of the EU, and concentrated only on the achievement of the actual development objectives, were unable to improve their relative situation. This conclusion may have important implications for the newly accessed regions. The basic principles for implementing structural policy in all the member states – that is, subsidiarity, decentralisation, additionality, concentration, programming, partnership and transparency – necessitated the modernisation of the organisational structure of national regional policies. The strict application of these basic principles in the member states of the EU has increased the efficiency of regional development actions and strengthened cohesion. Recently the new priority objective of the support policy of the EU, namely the priority of enhancing competitiveness is aimed at assisting in the sustainable development of regions. The European Union will have to make foundations for the future of Europe not only by developing the economy but also by measures of social policy. The democratic way of using power is the basis for the efficient development of the economy and society. Thus regional and cohesion policy are not only tools for economic development. Growth in itself does not mean an automatic guarantee for the balanced, sustainable and multifaceted development of regions.
68
Figure 2.5: Cohesion policy for 2007-2013, proportions by objectives in billion EUR, total: 336.1 billion EUR Source: European Commission, 2006a
2.2 Problems of borderline location, its natural and social features 2.2.1 Borderline research, multidisciplinary border sciences One of the great discoveries of the end of the 20th century was the emergence of new theoretical and research direction called multidisciplinary border science. The new science moving at the boundaries of regional and ethnic studies, multicultural and postmodern anthropology has considerably changed the idea of spatial identity and culture. The sudden emergence of this border happened – surprisingly – not in Southern and Eastern Europe (where border conflicts have been a common feature of life for centuries), but in America and North-West Europe. In the USA the institutions of states by the Mexican border (Florida State University, University of New Mexico, University of Texas) (Watts, 2003; Caulfield, 1998) and the research institutes and university departments of the US located by the Canadian border were the pioneers of the new research area. The University of Texas (El Paso) developed a unique combination for this multidisciplinary area when they brought together the relevant legal and social science research fields to establish the internationally recognised „The Journal of Law and Border Studies” (Kürti, 2006). 69
The first border science research centres were established in West-European universities (The Queen's University, Cross-Border Research Centre in Armagh, Borderline Research Centre in Ulster, the bordeline research centre at the Glamorgan University Wales, the Danish Border Region Studies Network, the University of London Geopolitics and International Boundaries Research Center, the regional research centre at the Department of Sociology of the University of Warwick, the borderline research units at the universities of Durham, Bergen, Nijmegen and Berne). The EU has started several international basic and applied research projects financed by various resources (Association of European Border Regions (AEBR - EUREGIO, 2006), the INTERREG A, B, C, or the EURES and the basic research project entitled „EU Border Conflict” at the University of Birmingham). The process very soon resulted in the estalishment of new research centres and university departments in countries of Europe within or without the EU. In 1989 after the break-up of the divided global worlds, a number of new nation states emerged and an enormous wave of migration started from East to West. Since the demolition of the Berlin Wall the territorial and border conflicts have given rise to new forms of nationalism and regionalism. Nowadays the border studies, cross-border studies are an interdisciplinary research field, focusing on the role of territory and spatial aspects in the formation of national identities, and related conflicts. The research of border conflicts have shown that the status of several disputed borderline areas has not been resolved up to now, in spite of many peace agreements before. Together with the gradual enlargements of the EU the national consciousness, identity and the myths of the nation state have come into focus. After the 90–ies there is a change in the terminology of the European policy: instead of „ethnic minorities” and „nations” new terms have been used: the idea of „region”, „territorial and non-territorial minorities”, „cultural identity” and „cultural community” (Kürti, 2006). During the past two decades the area of border research has become an important research area in Hungary, too. Following the mid-1980-ies not only history and political research but geography and spatial sciences have also focused their attention in the analysis of the development of „specific areas”, and in particular, border regions. After the years of the Eastern transition and due to the impact of the Euro-Atlantic integration an increasing number of research reports and studies have been published in Hungary. For a thorough list of these works see the references in the book by Béla Baranyi (2004).
2.2.1.1 Border areas, border cultures in Europe The problem of 20th century territoriality is not only the artificially determined borders of nation states but also the spatial extents of the national and ethnic-regional spaces or border cultures over the borders. The exact size of these has always been the source of many problems, not only in the Eastern and the Central and Eastern states, but elsewhere in Europe, too. The region has become the victim of nationalistic movements. The masses of populations exchanged over the border, the extradition of some 70
groups of the population, the concept and practice of ethnic cleansing have become familiar for the population of East-Central Europe and Western Europe as well, e.g. in the second half of the century, by the French and German border. Undoubtedly, since the 19th century European nation states are territorially delimited areas, which may be surrounded by hostile and sensitive borders. The borderline area plays an important role in the establishment of the emergence of nations and the emergence of the government: that is, the dialectics of the local and national interests formed the borders the national territories (Sahlins, 1989, cited by Kürti 2006). The states define their borders, control the way of crossing the border, and require documents (passports) to check the traffic over the border and cross-border cooperation. But the stronger the control, the stronger the opposition to it, which is well reflected in the terms „illegal immigrants, guest labour, asylum seekers, refugees” (Kürti, 2006). When assessing regional differences, then first of all we look at the development disparities of regions delimited by administrative borders attached to state territories. The planning and administrative regions cannot surpass the state boundaries. A different picture is shown when regions are delimited by functional aspects. In this case regions are defined not by the administrative-political boundaries but are unified by historical, economic, social or geographical ties (Hardi, 2004). The boundaries of administrative and functional regions may not be the same. The historical inheritance of Europe is the fact, that the definition of the nation state boundaries did not consider the areas of these functional regions and this way hurt the interests of both parties at the opposite sides of the border. The boundaries of an administrative region may fitted to the established state border, but it cannot be done for the historically and geographically evolved functional region. This latter will, in the fortunate cases, maintain the former economic or social ties (between town and rural area, or economic ties) over the border, but in the unfortunate situations this is no longer possible and the distorted region will have to build new functional ties or become a periphery within the new boundaries. The decrease of the dividing function of the state boundaries provides an opportunity for these borderline regions to recreate their former network of connections. It is rarely considered, however, that the boundaries of the nation state are only one barrier, and not even the most important one, against the cooperation and reunification of these functional regions, and a much more dificult problem is the contents what the border divides: that is, the different systems, powers and wills, institutional structures, etc.
2.2.1.2 The impact of the changed functions of national boundaries on the territorial processes The state border is a line which surrounds a state and separates it from other states. This line is precisely defined nowadays. It has not been always like this. Before the establisment of modern states neither tools nor willingness were present to create such boundaries. The identities of the 71
areas around the border used to be uncertain. The borders of the medieval empires were wide stripes of land (frontiers), in which the empires maintained protective zones against external enemies (Hardi, 2004). With the development of absolutist empires, the development of cartography and the unified systems of administration, together with the protection of the borders provided the technical conditions, and the development of the nation state concept gave the ideological framework for the birth of the modern border. The state status of the nation implied important spation consequences: the boundaries of the state of the nation became a pillar of the national identity and national sovereignty, which separates from other nations, and unifies within, surrounding a nation forming a state. The medieval frontiers were mainly – considering their function – externally oriented, their main role was to protect the state, while the modern borders are internally oriented, and define unified nation states to distinguish one from the other. The divided areas have turned into different developmental paths depending on the actual functions of the borders. The number and density of interactions between the spaces of the opposite sides of the border are important questions. How often and how regularly are connections created, what is their depth and how wide is the range of their contents? In some cases the only interaction is shoppers moving across the border (or even less interaction than that), in other cases there are wide and deep economic, institutional and social cooperations. If these questions are examined, there are various border types, e.g. those nearly totally separating the two opposite borderline areas, and there are nearly completely transparent ones, where people treat the other side of the border as the natural extension of their own region. According to the classification by Hardi (2004) the following border types may be defined: •
•
•
Alienated borderline areas are characterised by tensions of the two sides, the border is practically closed, there are hardly any interactions over the border, the two neighbouring states look at each other as aliens or even enemies. For Hungary such situations existed only for a short time between the two world wars, and in the 1950-es at the Hungarian – Austrian and the Hungarian – Yugoslavian borders. However, even in these times the population did not consider the other side as aliens, as follows from the specific history of the Hungarian borders. Co-existence of the neighbouring states, with temporarily stable relationship of the two countries. The border is somewhat opened, and this provides opportunities for the development of bilateral relationships. The inhabitants of the two countries occassionally meet, but the countries themselves establish only limited relationships. The example for this type is the Hungarian-Austrian border in the socialist times. Mutually cooperating borderline areas are those, where the two countries have stable, well established relationships. The complementarity of the two countries assists the development of the economic and social interactions, the territorial expansion of the borderline zone. The 72
•
neighbouring countries wish to maintain friendly and cooperative relationships. The example is the Hungarian borders in the 1990-es except for the southern borderline countries at war with each other. Integrated border areas are established when there is strong and permanent stability. The economies of the two involved countries are functionally merged, the flow of people and goods across the border is not subject to any limitations. The two countries may be considered one single social system. Such high level of cooperation has not been experienced by the Hungarian border yet, but the internal borders of the European Union definitely develop in this direction.
This separation or cooperation - that is, the separating role of the border depends on the historically and geographically evolved differences, that is, on the ethnic, spatial, economic and institutional, etc. differences. Another important influencing factor is the political division role that the border has to play in the specific age. Besides the geographical and political characteristics another, the mental border may also be a barrier or a supporter of the integrated cross-border areas. This phenomenon is nothing else but an image of the border created in the minds of the inhabitants. The image of the other side may be an alien world, or the continuation of the own world. This means the reflection of the geographical and political factors in the minds of the borderline. An interesting feature of this is that the separating role of the border might be different on the two sides of the border. The research done by the Hungarian-Austrian border showed that the mental maps of the Hungarians about the Austrian side of the border was a lot rougher with distortions, than the Austrians, who felt the other side of the border to be their own (Hardi, 2004, Hardi-Nárai, 2001). The changes of the mental border are slow and may take several years, even decades after the physical and political changes of the borders, as it was experienced after the Trianon agreement in the Carpathian basin or by the former border between East and West Germany. The creation, functional change or the demolition of the border may influence the development of the borderline areas. On the other hand, the characteristics of the borderline areas, in terms of ethnical, geographical, urbanisational, spatial networks and attraction zones, may also have their impacts on the separating role of the border itself, on the number of possible interactions, their densities, depths and contents.
2.2.1.3 Factors influencing the character of the border and the cross-border interactions in Europe The factors defining the types of the borders, and the development of crossborder connections may be analysed according to six criteria (Illés, 2000). The types of the borders in Central and South-Eastern Europe are not homogeneous, but rather differentiated, as it is true for the countries and 73
regions of the area itself. The differences can be described according to the following aspects: • • • • • •
Geography, Transport, History, Ethnic and sociological character, Economy, Access to the financial resources provided by the European Union.
These aspects will essentially determine the character of the border and its functions. In the following section the differences of the borders by the above aspects will be looked at in detail below, using the Central and Eastern European countries as examples. The geographical aspect: A considerable proportion of the historical borders is a division by the geographical sense, that is, the border is not only a political barrier, but a geographical one, too. About 27 % (3900 km of the total 16 000 km) of the Central and South-Eastern borders are rivers, 18 % (2700 m) are mountain tops. About 55 % of the present barriers, however, do not mean any geographical division at all. The existence of natural barriers have some importance even nowadays. The rivers can make a linkage, facilitating transport by water, but they also divide the two shores in the absence of bridges. The lack of bridges is the main cause of the fact that in some of the borderline areas the rivers have rather a dividing than a connecting character. By the 3900 km river borders there are altogether 55 bridges, that is, one bridge by 70 kms on average, although there are great differences by the various border sections. The Bulgarian-Romanian borderline by the river Danube has altogether 1 bridge (connecting Giurgiu and Russe) for the 470 km distance. The lack of bridges was very painfully felt when during the war in former Yugoslavia and the resulting embargo Hungary and Western Europe could be reached from Sofia by around trip of 1100 km length. Romania was not interested in building new bridges, because with that Bucharest could get into a peripheral situation in relation to the European transportation networks. Finally, in the last months of the war – as a result of pressure from the West – the two countries made an agreement about building a new bridge between Vidin and Calafat under the condition that the whole cost of the construction would be paid by the Bulgarian state. Sad examples may be found elsewhere, too. It is enough to remember the construction of the new Maria Valeria bridge connecting Esztergom and Párkány which took nearly 6 decades to be rebuilt. The natural borders have significance from another respect. The river valleys, the flood areas and the high mountains are valuable ecosystems themselves, with rare flora and fauna. The borderline location for these ecosystems meant protection, because agricultural activities, construction and tourism have been limited in these areas for decades. It is no accident that about two thirds of the nature reserve areas of these countries are directly located by the borders. This situation practically forces the involved countries to cooperate. 74
Transportation aspects: The borders, in this respect are distinguished by the number (density) of border crossing points and their facilities. By the 16000 km of borders in the Central and Eastern European region there are altogether 215 international road crossings, that is, one crossing point in every 75 kms. This average, however, covers wide extremes: in the Czech – Slovak border crossings are found at an average distance of 15 kms from each other, while by the Bulgarian – Greek, the Romanian – Ukrainian, the Moldovan – Ukrainian borders the density is only 1 crossing by 250 to 300 kms. If the minimum requirement of at least one crossing by each 50 kms is considered, then about 100 new international crossing stations should be established within a short time in the region. It is even more difficult to understand the very serious lack of border crossings, because – in spite of the insufficient quality of the infrastructure – the number of roads and railways crossing the borders used to be considerably higher in the past. A considerable proportion of the borders in the region is rather new, and the areas currently separated by borders used to be connected by a dense road network in the past. Approximately only 40 % of the roads crossing the borders are actually used as international border crossing points in the 18 countries of the region, and the rest are only used as „small-scale border crossings” open only for the citizens of the neighbouring countries, others are open only for a few hours per day, others are open only on holidays, and many are not open at all. Regarding railway crossings, 70 % of the rail lines leading through the borders are actually used as border crossings, but the situation varies and there are borders with much worse situations, where rails leading through the borders were actually demolished. The border between the Czech Republic and Saxonia was crossed by 15 rail lines at the beginning of the 20th century, while nowadays only 4 lines lead through to the neighbour country. The former East Prussia, Russia and Poland were connected by 7 rail lines, while nowadays there are none. At the beginning of the 20th century two rail lines crossed the area of the present SlovenianHungarian border, but at the end of the 20th century none of them existed any more, and the two countries spend enormous expenses on rebuilding one of them. The problems could be listed long, but this was enough for illustrating that the development of border crossings – in spite of progress made in the last few years – should still be a priority area of cross-border cooperation. Historical aspects: Among the historical aspects one of the most important features is the constancy or changeability of the borders, considering the extensive change of the European borders in the 20th century. Of the 16000 km borderline of the Central and Eastern European region only 420 km, that is, only 2.6 % is historically unchanged, that is, where neither the separation line, nor the national character changed during the 20th centrury: and this is the border separating Bulgaria and Romania, where the borderline is exacly the river Danube. 97.4 % of the border has been changed, often for several times. On top of all that the borders have been modified several times during the last 10 years: due to the breaking up of the former Socialist federal states the length of the borders have increased by 50 %. Besides, it must be mentioned that there are a lot more border sections than the already mentioned 2.6 %, which have historical roots, even if their role as international borders is a new feature. Most of the borders of Bosnia75
Hercegovina, or Croatia have historical origins. The border between the Czech Republic and Poland, in the Giant Mountains, is also very old, even if it had not been a Czech-Polish border, but an Austrian-German one at the beginning of the 20th century. There are, however, border sections, which have never been international borders in the past, and for this reason their exact location has never been precisely determined, which lead to several border disputes nowadays. This was the case with the borders between the former Soviet member states, or the Slovenian-Croatian border, the Croatian-Yugoslavian (Serbian) and the Yugoslavian-Macedonian borders or at least parts of these borders. Similar situation is encountered about the marine borders of the former Yugoslavian states. Most of the times these disputes refer to neglectable areas, but they are still important, because until some resolution is found they hinder or prevent cooperation between the involved countries. Ethnic and sociological aspects: From the ethnic and sociological aspects several border types may be distinguished: •
•
•
The „classical” type is the border of nation states, when the border separates two nations of different languages and different ethnic traits, but the two nations have been living side by side for several centuries, with strong economic and sociocultural ties established between them. This is the „least problematic” type, where the local authorities as well as the central governments – if they do not lead an extreme nationalistic policy – do their best to enhance cooperation and the strengthening of connections. This classical type is found by many Central and South-Eastern borders, but this is certainly not the majority. An example is the Slovakian-Polish border, or the Hungarian-Croatian and the Hungarian-Austrian border. For a significant proportion of the borders the coexistence does not have a long history. The extensive migratory processes, expatriations resulted in the formation of many border regions where the present population immigrated only about 50 years ago, having no connections to the people living over the border, and who have looked at the neighbour people with suspicion and fear, and where the prejudices have just began to disappear. Cooperation, in spite of the support by the central governments, is slow to develop, and without central support local initiatives are even more difficult to start. The example for this situation is the former German-Polish, the German-Czech, the Czech-Austrian border, and the same situation holds currently for the Polish-Russian (Kaliningrad) border. Finally there are borders where the same ethnic population lives at both sides of the border and the areas formerly belonged to the same state. The division of the region is relatively new, and sometimes strong family ties exist between the peoples living at the opposite sides of the border. The local population would like to make the bordes open, or penetrable. Unfortunately these are usually the areas where nationalistic policies often prevent the establishment of connections and build up and strengthen cooperation.
76
Economic aspects: Regarding the economic aspects the most important fact to consider is the level of economic development and the differences of the economic development at the two sides of the border. Empirical evidence shows that the cooperation is easiest to establish between similarly developed regions. The larger the difference in the levels of development the more chances of tension occur, e.g. by illegal labour migration, black labour markets, the spreading of half-legal and illegal activities based on the exploitation of existing price and wage differences, or the different environmental requirements, norms and expectations. This does not mean that the establishment of fruitful cooperation is impossible between regions of different development levels, but in this case more attention should be paid to these differences and careful regulation is needed. Traditionally large development gaps have been experienced at the Eastern borders of the EU-15, and this gap – although decreasing – still exists. Recently another gap has emerged at the Eastern border of the Visegrad countries. This gap is much larger in its proportions than the Western gap, because the Eastern counties of Hungary are at about 35 % of the average development level of the EU, the neighbouring Romanian regions are at 20 %, the Serbian and Ukrainian regions at about 10 %. Finally the last, but not neglectable aspect is the access to financial support from the EU: From this aspect the following three categories may be defined for the borderline regions: •
•
The first type is the regions at the borders of the EU. These seem to be in the most favourable positions. The cooperation is financed for the neighbouring EU countries from the Structural Funds, and for the areas of the associated countries the pre-accession funds. Because it is in the interest of the EU countries to develop, the development of the regions at their borders, and the improvement of their infrastructure, the above resources are mainly spent on these areas and regions. However, the whole picture is not so bright as it seems to be. First, in the years preceding the programming period of 2007-2013 the support funds were administered and managed at completely different directorates of the EU Commission in Brussels, and this gives rise to many uncoordinated actions and decisions. On the other hand, the priorities of the partner countries accross these borders may also be different. The border regions of the EU member states may receive the greatest amount of support not from the cross-border programmes, but from the structural funding offered for underdeveloped EU regions to solve their most severe problems, and for them the cross-border cooperation is like a „dessert” after dinner. At the same time the associated countries see cross-border support as the only available funding, and they try to solve their most severe development problems from this resource. This means that the objectives of the utilisation of EU funding are completely different at the opposite sides of the border. The second type is the borders between associated countries. In 1996 the European Union recognised that not only the borders between the EU-15 and the associated countries need development, but the 77
•
development of the borderline areas between the future EU-member countries themselves also need support. From then on the crossborder section of the pre-accession funding has been made available for these border regions, too, with the condition, that both parties at the opposite sides of the border agree to the cooperation. However, this also mean that if one of the countries do not wish to cooperate, then the borderline regions of the other country cannot receive funding either. The problem is still present, that the EU encourages mainly the development of the border regions by its own boundaries, while the associated countries wish to direct their development priorities to their Eastern borders being most underdeveloped, and this often creates tensions in the allocation of available funding. Finally there are several border areas in the Central and Eastern European region which cannot expect any EU resources for supporting their development. Unfortunately these are exactly the most underdeveloped areas most in need of development resources. This was the case before 2004 with the Hungarian-Yugoslavian (Serbian), Hungarian-Croatian and the Hungarian-Ukrainian border. Following the 2004 enlargement of the EU, and the inclusion of new countries among the candidate countries, the Neighbourhood Programmes offer development funding the eastern and south-eastern neighbours of the EU, although to a more moderate extent than the amounts available for the member states (Illés, 2000).
2.2.2 Regions of specific conditions, borderline location and peripheral character Underdevelopment is a relative phenomenon, and can be defined by comparing regions. The main features of underdevelopment may be generalised, but still it is difficult to understand them without comparisons. The same area, which may be considered a relatively developed region compared to the rest of the country, may turn out to be an underdeveloped territory in another system of comparisons. An example for this is the West Transdanubian region in Hungary, which is a relatively developed territory within Hungary, but remains a region of less developed than the average of the European Union (Laczkó, 2002). Regions of specific conditions Many research projects have been carried out with the aim of finding out the reasons and traits of spatial disparities. By now it has become obvious, that the spatial differences cannot be eliminated, but their characteristics may be changed. The tools and measures focused on the fast improvements of the development level in underdeveloped regions loose their efficiency with time as the forms and reasons of the disparities change. In analysing the reasons of underdevelopment specific factors are often recognised, which create unique, specific conditions for the region, thus delimiting the possibilities of development. The problems of such specific regions, and their specific 78
development characteristics may crucially differ from the problems of the average regions. Papp (1998) declares that „areas of specific characteristics are not simply areas differing from the average, but areas with extremely unusual, unique features and conditions…” It may be assumed that this type of territory is mainly associated with specific locations, specific connections between its settlements, or less frequently, the specific production processes and production conditions not found elsewhere. Such specific areas may be the agglomerations surrounding large cities, an area by the national borders, a very dynamic, or just the contrary, a very depressed region, or spatial economic unit (e.g. a region of declining heavy industry). The category of specific regions includes the regions favoured by tourism and recreation, and these are actually outstanding considering their importance from the local to the national resort areas. The research of these specific areas is naturally of a multidisciplinary character, as the regions themselves require, because the problems encountered may be very extensive, covering several fields of research. Thus a metropolitan agglomeration owns a specific combination of settlement structures, settlement connections, infrastructural levels and social problems all in the same time. The concept of areas under specific conditions does not cover homogeneous areas. These are completely different, specific territorial units identifyed by a few extreme criteria, among which the underdeveloped, peripheral, unevenly developed regions may be found as well as the agglomerations of highly developed urban areas. The concepts of periphery and borderline region cannot be considered the synonyms of each other, but both of them may be the examples of regions under specific conditions. While the peripheral situation is associated mainly with the long distance of the region to the centre of the region, that is, with an internal factor of the region, the concept of borderline location relates to the external connections of the region. The impacts of borderline location are mainly determined by interstate relations, and the hostile character of these relationships have made the borderline location an undoubtedly disadvantaged situation. Under friendly interstate relationships there is a chance that the borderline areas can benefit with the advantages of the specific location and establish dynamic cooperation over the border. The spatial economic structure of a country contains centres and peripheries of various connections and hierarchical levels. The peripheral character means not only long distances from the centre, but also a temporal delay of development. The majority of disadvantaged regions is also peripheral, lying by the borders of states or counties. The borders unchanged for a long time allow crossing to the other side at only a few special points, and there are no built roads to the settlements located at the other side of the border. Although not every borderline area is underdeveloped, but even then their situation contains specific, often extreme, characteristics (Pál – Vörösmartiné, 2002). 79
Temporal changes of spatial development show regular laws of development which, being recognised, facilitate the better understanding of the specialities of these unique areas, and, in particular, the problems and challenges the borderline regions face (Laczkó, 2002). • Spatial changes are slow, and react with delay to the social and economic progress. The reason for that is the fact, that the phenomena associated with development comprises long life elements (houses, infrastructure, buildings). • The spatial structure is not very easily changed, partly due to the above reasons, and partly because the speed of change is different for the individual development factors. • The spatial structure can adapt to the changes of the economic structure only slowly, e.g. the changes in the structure of production will be followed only slowly by the changes of the settlement structure (e.g. the need for land in an agricultural area may differ from the traditional outlay of villages). • The cyclic changes of the concentration and deconcentration processes cover usually much longer cycles than the usual business cycles. Bordeline situation and peripheral character By the definition of the European Union borderline regions are NUTS III level territorial units, which have borders that are at the same time borders of the state, too (Illés, 2000). One of the main objectives of the spatial development policies is the diminishing of the large development disparities, and the speedy development, catching up of the underdeveloped regions (Erdısi,2002). In assessing the problems of borderline location the problem is not mainly the distance of the region from the central areas, but the relationship between the two neighbouring countries, the political relationships of the two states. That is, the priority factor is the quality of interstate relations, and the problems of regional disparities is only of the second order. The factors leading to the underdeveloped status include the one-sided economic structure with the dominance of agriculture, the settlement structure with mainly tiny villages, the level of urbanisation being much lower than the average, the unfavourable natural conditions, and the insufficient level of transport infrastructure. A large proportion of the multiply disadvantaged regions are situated in the peripheries, by the national or county-level or regional borders. Naturally, it is not possible to generalise, it is not right to declare that the borderline location will lead to underdevelopment. Many borderline regions are known to function as gateway regions, having attained at least the average, or even higher levels of development (Erdısi, 2002). The state borders provide, in theory, the possibility for both separation and for cooperation. However, international experience suggest, that up to the recent times, with the exception of a few successful integrations the borders 80
mean a breakage, a gap in the economic space, and this way the cause of underdevelopment. The borderline settlements have had a one-sided network of connections, leading only to the insider of their own countries, and this limited space created a dependence of them to the centres near the border. This was the situation by the borders even if these separated two friendly countries, and especially so, when the border was drawn by natural barriers making traffic and transport making traffic over the border very difficult, if at all possible (e.g. high mountains, deep and wide rivers difficult to cross. In Europe the borders between states having conflicts and hostile feelings towards each others, have been practically impenetrable for economic processes. Suspicion has become a permanent way of thinking about each other, together with ethnic conflicts by the border, and preparations for expected wars gave the borderline regions a kind of temporary character, which hindered development and frightened off the productive and infrastructural investments. In Europe such buffer zones were in Alsace – Lotharingen and Schleswig – Holstein, or Western Poland and the Sudetas in the Czech Republic. During the temporary border conflicts the intervention by the involved states (e.g. expatriations) created long term impacts lasting for several decades (e.g. at the Yugoslavian borderline, the Chinese-Russian borders, or in the Third World at the border of India and Pakistan or Sudan and Ethiopia, and the zones occupied by the Israeli army). The border regions often mean the meeting zones of different cultures, languages, ethnic minorities. Although up to the recent years, these territories have been the areas of suspicion and isolation in Europe, nowadays, together with the strengthening of integration the population of these regions can significantly enhance the possibilities of understanding the neighbouring countries and to forming favourable opinions about the neighbouring population. By this the borderline population may improve the trust and understanding for towards the neighbours, bringing about the economic, cultural and linguistic enrichment of the neighbouring peoples and facilitate the utilisation of advantages of the borderline location, and generate dynamic complementary development mutually advantageous for both countries. Borders and borderline location in spatial development The role of borderline situation in spatial development is a research topic of outstanding importance. The quality of life for the inhabitants of the borderline regions is essentially determined by the quality of the border. The quality of life may be improved if the cooperation possibilites of these regions improve over the border (e.g. by town twinning, exchange of labour, joint environmental or spatial development projects or retail trade over the border). The increased penetrability of the borders enhance the „connecting” character of the state boundary, and the local spatial development initiatives may rely on the new connections. Where, however, the separating role is strengthened, the borderline areas remain peripheral in character (Süli-Zakar, 2002). 81
In the European Union the borders have become practically completely penetrable due to the four freedoms, that is, the free movement of goods, capital, services and labour. Crossborder cooperation has become a priority in the support policy of the European Union. To enhance the active cooperation of neighbouring countries the most efficient level should be the level of neighbouring regions and not the nation state level. Borderline areas have a multilateral role in the cooperation of neighbouring states: • They are the areas of former historical conflicts and this makes them very sensitive to the political events related to the country over the border. • They are the primary locations for strengthening the economic relationships with the neighbouring country – including capital investments and exchange of labour force. • They are the intermediaries of the relationship of the two countries, that is, they can contribute to make the neighbouring country and nation better understood, to transmit information about their culture, economy, institutional structure, innovations, new and adaptable values – and the border regions can spread this information towards the inner regions of their own country. As the above suggest, the concept of the border and the periphery are not synonyms, but the border region is a very special type of a peripheral region. A country may have several peripheral territories which are not borderline areas, and at the same time a border region may be a successful, dynamic gateway region which builds lively connections towards the other side of the border. The development of border regions is influenced by: • •
• •
The structure of the economy, The regional characteristics of labour, the ageing or less qualified labour potential (in which case there are no alternatives for the workers, migration is a one way process leaving the area depopulated) leading to high unemployment rates, Mental factors (the lack of entrepreneurial mentality, the independent property owner’s attitude), The presence of minorities, the existence of multicultural and multiethnic settlements occurring in the border regions of three countries.
The regional structure of a country is very slow to change. Some elements, like the settlement structure take about a century to show considerable modifications, while other elements, as the infrastructural and communications networks may be established during several decades. Changes in the state of the economy, the structure of industries and of employment and in the spatial mobility of the population may be much faster. 82
The active participation of the actors of the local economy and local society are absolutely necessary to enhance the development of a region, without which the states support cannot achieve any remarkable change. The local governments, municipalities, civilian organisations, NGOs, and generally the local society play an important role in representing the interests of the region (Süli-Zakar, 2002). The territorial differences are derived mainly from the geographical location of the region, the education level, skills and qualifications of its population, its sensitivity to innovation, the presence of the traditions of the middle classes. The economic actors, becoming autonomous decision makers, will consider in their location choices the economic advantages a region can offer, and in this decision making the borderline areas are usually losers, due to their weak transport and communications networks, underdeveloped business services. Naturally, this leads to the increasing levels of territorial inequalities. For this reason many of the borderline areas have become crisis regions, which implied high levels of unemployments, impoverished population, the loss of the value of property, and this was especially typical for rural regions, where the elimination of the former main employer, the agricultural cooperative, meant not only the loss of jobs, but also the loss of local industrial and service activities and the deterioration of the infrastructure of the villages, too. The borderline regions of Eastern Hungary, as the last stable EU-regions, could develop a specific capacity to attract investments. During the former enlargements of the European Union a typical tendency was noted in the borderline areas, and the towns and cities of these areas cound become gateway cities, and outstanding regions of international relations. And the capacities of borderline towns in attracting investments, in tourism, conference tourism, financial and marketing roles have considerably improved. The development of transportation facilities, the construction of motorways would create a sudden boost of development in these regions. Similar positive impacts may be expected from the establishment of regional airports, because business people usually prefer the same mode of transport (that is, by air) from their departure to their destination locations. It would be also necessary in the borderline regions to design joint strategies of economic development, and the creation and implementation of joint programmes could utilise the advantages of cooperation to the greatest extents, and boost the development relying on the complementarities in the facilities and resources of the borderline regions at the two sides of the border. Good examples are for this the Euregions in the European Union, which became success stories in the Western part of our continent.
2.2.3 The actors of transboundary regionalism Transboundary regionalism can be defined as a spatially integrated form of political co-operation and problem-solving that transcends the limits of 83
nationally-based administrative practice and attempts to create (or re-create, as the case might be a sense of cohesiveness, interdependence and common interests across national boundaries (Scott,1996; Scott, 1999). In order to explain this we have to consider the formal and informal institutional contexts providing incentives, disincentives, opportunities and limitations for co-operation. Local and regional co-operation across national boundaries can be seen as a product of different motivations and strategic concerns. Indeed, the basic premise behind transboundary co-operation is the desire of individuals and groups to co-ordinate action in order to solve problems or realise new economic benefits that could not be realised acting alone. Accordingly, transboundary regionalisation patterns and the modes of co-operation they involve can vary considerably from context to context. The following methodological approach has evolved out of research on border region interaction and the construction of transboundary co-operation regimes in Europe and North America (Scott, 1999). Elements and variables in the processes of transboundary regionalism Transboundary actors often engage in co-operation activities voluntarily and with specific interests, assuming net benefits from co-operation. In a sense, they may form goal-oriented networks of elites who partially transcend local contexts in defining their agendas. On the other hand, the establishment of such networks and communities of interest is ultimately affected by local and regional conditions. Even though flows of knowledge and information between network actors have been largely liberated from technological and territorial constraints, actors remain territorally based, reflecting specific political, economic and institutional contexts. In addition, regional cooperation projects are playing an increasingly important role in providing encouragement, orientation and financiaI support to transboundary urban networking. Thus, transboundary interaction (the construction of political communities) can be characterised by quantifiable activities and flows as well as by documentable attitudes and orientations of transboundary actors and their co-operation experiences. We must scrutinise transboundary actors, the issues they emphasise and the strategies they employ with which to realise common objectives. These must, however, be put into perspective with other factors that include environmental (e.g. overlapping economic, political, attitudinal, cultural) factors, actor-specific characteristics (e.g. jurisdictions/authority, institutionaI affiliations, responsibiIities, accountability, resources, objectives), strategic orientations of co-operation (such as premises, priorities, goals, types of initiatives and projects) and parameters of co-operation experience (including conflictual aspects, aspects promoting consensus, perceived barriers to co-operation). FinaIIy, national and European policies that affect local/regional transboundary co-operation must be taken into account. When analysing the transboundary interactions the following questions may be asked: • Who interacts and why? (Premises and rationales) • How does interaction take place (form and structure of co-operation)? 84
•
•
To what extent is this interaction embedded within larger (political/economic/social) contexts? To what extent is it composed of díscrete/closed networks? What does this interaction produce in terms of tangible/intangible products (results)?
The analytical elements of the assessment should include the following elements: • The structures operating at differing scales and the political economy of co-operation (e.g. strategic rationales, regimes, incentives and restrictions), that is, the background defining the conditions and opportunities for co-operation, • Co-operation structures in development (networks, fora, associations, agreements, contracting), • Agenda-defining processes and strategy-building (definition of priorities, expression of interests). In pursuing the questions outlined above, we must balance attention to the manner in which the established cooperation promotes the development of transboundary communities of interest with a keen awareness of the contextual heterogeneity of these cooperation networks themselves. •
Actor-specific organisation characteristics - Local and regional governments - forms of co-operation established, and level/s of formalisation, - resources dedicated to co-operation networks, - jurisdictions and level/s of autonomy. - Senior governments - relative role with respect to local and regional governments - jurisdictions - resources dedicated to support of co-operation networks (if applicable) - Local official or non-official transboundary co-operation organizations - relative role with respect to local and regional governments, - forms of co-operation established and level of formalization, - resources dedicated to co-operation networks, - jurisdictíons and level of autonomy. - Local and regional enterprises - generation of employment across borders, - generation of flows of commodities crossing borders, - local producer/suppIier/retail networks as measurements of market complementarity. - regional transboundary investment patterns, - interfirm co-operation patterns, - co-operation with private-sector interest groups. - Non-governmental organisations with specific co-operation interests - relative role with respect to local and regional governments, - resources, - areas of competence and/or expertise. 85
•
Interdependence of Local Markets and Services - cross-border commuting (intensity of day-to-day interaction), - numbers of people crossing borders for work, shopping, entertainment, family, - the degree of transboundary utilisation of public/private schools, - the degree of transboundary utilisation of other public facilities and institutions.
•
Wider contexts for interregional interactions - Types of local policy framework - the existence of special co-operative agreements and their importance; - the existence of special economic zone and tax regimes; - the structure and degrees of integration of public transportation networks, - national policies affecting border regions and transboundary co-operation; and - European policies affecting border regions and transboundary co-operation. - Strategic Orientations in Transboundary Networking - co-operation Priorities, - sectoral orientations of co-operative projects, - time frames.
•
Co-operation Experiences and Results - issues promoting consensus/conflict, - stability of co-operation, - perceived obstacles to co-operation, - actual co-operation results,
These indicators should help us uncover transboundary interaction patterns (including intensity) within specific contexts. Once having done this, comparative analyses can help to establish relationships (albeit perhaps of a tentative nature) between these various indicators and thus allow generalisations.
2.3 Interregional and transboundary cooperation in the EU 2.3.1
The forms of transboundary cooperation in Europe
International relations and transboundary cooperation below the national level Traditionally the transboundary cooperation belonged to the authority of the sovereign nation state. It was the task of the government to define the objectives, then the organisations responsible for foreign relations discussed 86
it, and international agreements were signed to ensure and implement them. The situation has changed by now. In international nerworks and crossborder cooperation projects the public actors of local regions and the local representatives of central regions take part. There are transboundary regions built up on different legal foundations, and formal authorities over regional boundaries, which do not belong under the authority of the foreign ministry of the relevant nation state. The present section describes briefly the forms of transboundary cooperation initiated and implemented below the national level (Kühl - Klatt, 2004). Borderline regions There is no generally accepted definition for the concept of transboundary regions. It is usually defined that it is an administrative territorial unit (at NUTS III level, by the EU definition) within the nation state that is located by the continental or marine border of the nation state. It implies, that a state within a federal state, or a province or a country, or even an accidentally formed group of local municipalities may behave as a borderline region (Kühn - Klatt, 2004). The social and economic problems of the borderline territories The economic, social, political and cultural life of a borderline region is strongly influenced by the presence of the geographical border. This impact of the border is usually negative: • Due to the border there is no interaction, • Due to the vicinity of the border the economic capacities are not utilised fully, • Provinciality: the region lies far from the centres of economic and cultural development, both in physical and mental sense, • There is a tendency of out-migration, especially for the highly qualified members of the population. Historical and political conflicts in the borderline regions In a borderline region there may be unresolved cultural or territorial debates: • The location of the border is disputed because of some past historical injustice. • The ethnic minorities wish to separate or demand the revision of the border. • The conflicts of the neighbouring states have been only superficially resolved. • The neighbouring nations are traditionally hostile towards each other. The above barriers may go against the well-meaning plans aimed at cooperation over the border. 87
The institutions of interregional and cross-border cooperation Council of Europe: After the Second World War, cross-border cooperation at regional and local level became an important issue in Western Europe. In 1948, an International Union of Mayors for French-German Understanding was established as a basis for twinning of cities all over Europe. A Special Committee for Local and Regional Affairs was established under the Council of Europe in 1952. In 1957, the Council of Europe established a Standing Conference of Local and Regional Authorities. Negotiations between the Standing Conference and the Council of Ministers led to the Council of Europe’s Framework Convention on Cross-Border Cooperation, opened for ratification in 1980. The Framework Convention did not oblige states to allow border regions to engage in cross-border cooperation agreements, but it proposed different formal agreements to incorporate cross-border cooperation to regional and local actors. In the First Additional Protocol of 9 November 1995, the ratifying parties acknowledge the right of sub-state administrative units to conclude legally binding cross-border cooperation agreements within the scope of national law. A Second Additional Protocol will extend the cooperation aspect with a dimension directed at inter-territorial integration. The Protocol was opened for signature and ratification in 1998 and came into force in 2001. Until July 2004, only 12 member states have ratified the Second Additional Protocol. Although the Council of Europe accepted the Framework Convention on Cross-Border Cooperation, in 1980 – that is, more than 10 years before the first Eastern European countries joined the Council – so the convention is more than 20 years old by now, there are still a few European countries who have not ratified it yet. Among the old member states the following countries have not ratified it: Greece, Turkey and the United Kingdom. Among the Eastern European countries only Poland, Hungary and Ukraine have ratified it up to 1996, and several Eastern European governments have not ratified it up to now. Besides, and in spite of this, spatial cooperation initiated in a decentralised way has spread throughout Europe at a fast speed, which means that the regions are much more interested in this type of cooperation than the central governments (Illés, 2000). European Community/European Union Cross-border cooperation has not been a specific EC/EU field of activity until the 1990's. In 1975, the European Regional Development Fund (ERDF) was established, but not specifically engaged in cross-border cooperation. The ERDF provided a platform for local and regional government contacts and interaction, though. In 1979, several sub-state agencies and associations were grouped in the Bureau of Liaison of Organisations of Regions in Europe, as well as local authorities became represented in the Economic and Social Council as well as in other consultative committees of the EC/EU. 88
In the late 1980's the EC introduced the so-called Article 10-Programmes under the ERDF to support regional cross-border cooperation projects. These programmes were the predecessor of the Community Initiative Interreg supporting cross-border cooperation within the EC/EU. Interreg III programme period is 2000-2006. To support cross-border cooperation outside the EU, the PHARE CBC, TACIS CBC and CARDS programme were introduced in the 1990s. A second framework for regional cross-border cooperation within the EC/EU is the Committee of Regions established in 1992. It provides a forum for elected regional representative to influence EU decision-making including regional policies (Kühn – Klatt, 2004). Institutions of transnational regions Several large scale cross-border cooperation regions have been established in Europe since the Second World War, such as the Nordic Council (Denmark, Finland, Iceland, Norway, Sweden), the Cooperation Ireland (Ireland, United Kingdom), the Neue Hanse Interregio (Germany, Netherlands), the Danubian Region (Germany, Czech Republic, Austria, Slovakia, Hungary, Croatia, Serbia, Romania, Macedonia, Ukraine, Bulgaria) and the Association AlpsAdria (Austria, Switzerland, Germany, Italy, Croatia, Hungary, Slovenia). These regions are defined as transnational regions, as they cover a considerable territory within or even including several nation states. Their legislative framework is usually based on voluntary cooperation agreements not legally binding according to international law. The institutional framework can be assemblies, regularly scheduled conferences of political actors and a secretariat responsible for the implementation of activities. Aims are usually centred on economic, environmental, tourism and, to some extent, cultural aspects. Legislative framework at regional level Regional cross-border cooperation does not necessarily need to be based on a legislative framework. In the Danish-German Sonderjylland-Schleswig Region, continuous cross-border cooperation worked on an informal basis from the early 1970's and was only institutionalised in a legal framework in 1997. The above mentioned Council of Europe conventions have led to several specific legislative frameworks for cross-border cooperation agreements in some parts of Europe, though, and there is an obvious tendency to use legislative frameworks to intensify cross-border cooperation at regional level. The first category of legally binding cross-border cooperation is cooperation based on civil law. Here, the partners involved in cross-border cooperation establish a cross-border association based on the national civil law of one of the involved countries. Such associations cannot take legally binding public acts, though, as they are not based on public law.
89
The next category of legally binding cross-border cooperation is cooperation within public law. Such a construction makes it possible to delegate legislative and administrative functions to a public body, to establish a representative assembly for the regional cooperation and to ease the establishment of an administrative structure connected to the cooperation (Kühn – Klatt, 2004). Some European Countries have ratified treaties allowing their sub-state administrative units to establish legally binding cross-border public bodies without consulting the respective national government: • •
• • • •
BENELUX-treaty regarding cross-border cooperation between territorial communities and authorities, signed in 1986, in effect from 1991. Treaty between the Kingdom of the Netherlands, the Federal Republic of Germany, the ‘Land’ Nordrhein-Westfalen and the ‘Land’ Niedersachsen regarding crossborder cooperation between territorial communities or authorities (Isselburg-Anholt treaty), signed in 1991, in effect from 1993. The Karlsruhe-treaty on cross-border cooperation between regional and local authorities among Germany, France, Luxemburg and Switzerland signed in 1996, in effect from 1997. The Rome-treaty on regional cross-border cooperation between France and Italy, signed in 1993, in effect from 1995. The Bayonne-treaty on regional cross-border cooperation between France and Spain, signed in 1995, in effect from 1997. The Mainz-treaty on cross-border cooperation between regional authorities and other public actors between the German ‘Länder’ Nordrhein-Westfalen and Rheinland-Pfalz and the Belgian Wallonic Region and German Community, signed 1996, in effect from 1998.
There has also been a tendency in several European countries’ national and constitutional law – e.g. in Germany, Austria, Switzerland, Belgium – to empower local administrative units to engage in legally binding cross-border cooperation and conclude treaties according to international law. Euroregions and Working Communities The term Euroregion is most frequently used when establishing regional cross-border cooperation between border regions in Europe. Euroregions are not bound to a specific institutional framework: The level of cooperation can vary widely from institutionalized regions with first forms of transnational regional government, assemblies and budget, over loose co-operations between local authorities, to merely irregular, informative contacts between political and institutional actors. The first Euroregions were established in the late 1950s along West Germany’s Western borders as well as at the BENELUX-countries’ inner borders. A second wave followed in the 1970's within the EC, a third wave after the upheavals 1989-90 throughout Eastern Europe. 90
In 2000, the Association of European Border Regions listed 136 Euroregions on European borders. The general framework for institutionalised Euroregions comprises a joint secretariate responsible for day-to-day activities, a consultative assembly with delegates from the Euroregion’s administrative units and regional assemblies as well as concrete committees dealing with actual aspects of cross-border cooperation. Some institutionalised Euroregions dispose of a budget to cover activities provided through membership fees of the participating regional administrative units. Until today, no Euroregion has succeeded to obtain legislative power superseding respective national law, though. Euroregions are supposed to provide European integration at a local level. Their activities centre around cultural cooperation, “people-to-people” activities, tourism, the development of a common cultural heritage, enhanced economic cooperation, improvement of the flow of communication across the border, improvement of crossborder infrastructure. Again, no specific scheme for activities is given, but concrete measures are a matter of finding common interests and of decision-making by the involved partners. Comparative research indicates, though, that ambitions are often higher than tangible results. The first Euroregion established with Hungarian participation was the Carpathian Euroregion – covering extensive territories of five countries – was neither in its overdimensional size, nor in its functionality showed the characteristics of the Euroregions. There are initiatives to establish two Euroregions with Slovakian partner regions, and also Euroregions with the Croatian and Bosnian regions, but these are only in the phase of declaration, so there are no experiences about their activities. The "Duna-Körös-MarosTisza" Euroregion with Yugoslavian (Serbian)–Hungarian–Romanian regions involved has suffered from the crisis in the Balkans. The character and activities of an Euroregion are probably best fitting to the recently established West-Pannon Euroregion, comprising Burgenland (Austria) and three Hungarian counties in West Transdanubia. The other form of cooperation is the Working Community (Arbeitsgemeinschaft: ARGE, Communité de Travail: CT). This form of cooperation covers much larger areas and more territorial units than the euroregions, and its objective is not so much the planning and implementation of actual projects, but to identify possibilities of cooperation and to prepare overall development strategies for the particular area, and exchange of experiences in various fields of interest. The Alpine-Adriatic Working Community may be mentioned as an example with Hungarian involvement (of altogether 19 regions), or the Working Community of Danube Regions (of 35 regions as members). The Carpathian Euroregion mentioned above is more similar to this category of cooperation than to the group of euroregions, but at the time of its establishment the name „euroregion” sounded more attractive than the „working community” having been somewhat overused in the former decades (Illés, 2000). 91
Problems encountered with regional cross-border cooperation Legislative and institutional problems As mentioned above, several legislative foundations have been proposed for institutional cross-border cooperation at regional level. Still, a major obstacle to cross-border cooperation is finding a legally binding construct for institutionalisation acceptable for all partners involved in a Euroregion. Institutionalised cross-border cooperation is in principle a matter of international law carried out by subjects of national law. The process of developing practical legal constructs in this complicated question is still under way; but it is generally valid that communal and regional bodies (with the exception of the mentioned ‘Länder’, Cantons and Regions in federal countries) can hardly enter legally binding cross-border cooperation without the consent of the respective national governments. National law supersedes legal aspects of cross-border cooperation: no Euroregion has actually obtained legislative competences. The hitherto developed institutions for cross-border cooperation can thus be characterized as “soft institutions”, depicting their weak status between national political institutions. Thus, national borders still mark national law and different, often incompatible social systems (Kühn - Klatt, 2004). Cultural problems A Euroregion is supposed to provide regional cross-border integration. Supporters for European integration often use the analogy of borders as “scars of history” to argue for a Europe without borders. Those supporters claim that regions in Europe with a common regional culture and identity have been unreasonably separated by the historical processes resulting in the establishment of national borders. Actually, border regions also mark cultural borders and cultural separation. Euroregions have hitherto not developed common cross-border regional identities superseding national and regional identities. A language barrier is still characteristic for most border regions, and actual interest for crossborder interaction at a people-to-people level is low. EU-programmes in the period 2000-2006 INTERREG The INTERREG-programme is a Community Initiative directly supporting cross-border cooperation projects between EU-member states. INTERREG III, which was ended in December 2006, was the programme offered for the years 2000-2006. The new members of the EU have become eligible for a reduced INTERREG III period 2004-2006. INTERREG III was made up of three strands and had a total budget of 4,875 billion Euro (1999 prices). • •
INTERREG III A supported cross-border cooperation between adjacent regions and was aimed at developing cross-border social and economic centres through common development strategies. INTERREG III B supported transnational cooperation involving national, regional and local authorities and was aimed at promoting 92
•
better integration within the Union through the formation of large groups of European regions. INTERREG III C supported interregional cooperation with the aim of improving the effectiveness of regional development policies and instruments through large-scale information exchange and sharing of experience (networks).
Phare CBC The Phare programme, created in 1989, was one of the three pre-accession instruments financed by the European Union to assist the applicant countries of Central and Eastern Europe in their preparations for joining the European Union. It covered the 8 new member states that accessed in 2004: the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia, as well as Bulgaria and Romania. Phare’s main objectives were: • Strengthening public administrations and institutions to function effectively inside the European Union. • Promoting convergence with the European Union’s extensive legislation and reduce the need for transition periods. • Promoting Economic and Social Cohesion. TACIS (Technical Assistance for the Community of Independent States) Launched by the EC in 1991, the Tacis programme provided grant-financed technical assistance to 12 countries of Eastern Europe and Central Asia (Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzistan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine and Uzbekistan), and was mainly aimed at enhancing the transition process in these countries. The 2000 Regulation valid for the period 2000-2006 concentrated Tacis activities on the following areas of cooperation: • • • • • • •
Support for institutional, legal and administrative reform, Support to the private sector and assistance for economic development, Support in addressing the social consequences of transition, Development of infrastructure networks, Promotion of environmental protection and management of natural resources, Development of the rural economy, Support for nuclear safety, where applicable.
The Tacis cross-border programme promoted cooperation and development of links between neighbouring communities in different countries. CARDS CARDS (Community Assistance for Reconstruction, Development and Stabilisation) is a programme to promote stability and peace in the Western Balkans (Albania, Bosnia and Hercegovina, Croatia, Serbia and Montenegro, The Former Yugoslav Republic of Macedonia). 93
Four main objectives were defined for the 2000-2006 programme period: • Reconstruction, democratic stabilisation, reconciliation and the return of refugees. • Institutional and legislative development, including harmonisation with European Union norms and approaches, to underpin democracy and the rule of law, human rights, civil society and the media, and the operation of a free market economy. • Sustainable economic and social development, including structural reform. • Promotion of closer relations and regional cooperation among countries and between them, the EU and the candidate countries of central Europe. Neighbourhood Programme The Neighbourhood Programme is a cross-border cooperation programme between non-EU countries located by external borders of the EU and the neighbouring EU member states. The cooperative actins were mainly focused on the following two priority areas: Development of economic and social conditions for the creation of an integrated regional area: • Improvement of the economic structure, acceleration of structural change, approximation of economic strength, improvement of local conditions, technology and innovation development. • Improved coordination of basic transportation, technical and other infrastructures, as well as reduction of border-related barrier effects. • Strengthening of sustainable regional development. • Reduction of environmental impacts, elimination of existing environmental damage, improvement of the quality of life and the environment for the local population. • Improvement of the education and employment situation for women and men. • Development of human resources and strengthening of the endogenous potentials of the border region. Strengthening of cross-border relations between people, organisations and institutions in every structural area • Improvement of cross-border economic cooperation. • Reduction of barriers and creation of better connections in crossborder traffic and transport. • Cross-border coordination of efforts to protect resources and environment. • Improvement of cross-border social and cultural exchange aimed at enhancing the area’s attractiveness as a residential and living space. • Creation of cross-border cooperation and communication networks with a view to strengthening the regional identity of the border area.
94
European interregional cooperation programmes in the period 2007-2013 In the new programming period starting in 2007 the EU defines three priorities for its regional programmes. The first is the priority of convergence, the second the priority of competitiveness and employment, and the third one is the European territorial cooperation, which defines cross-border, transnational and interregional cooperation a full-scale priority in its own right. The European Territorial Co-operation objective will strengthen cross-border co-operation through joint local and regional initiatives, transnational cooperation aiming at integrated territorial development, and interregional cooperation and exchange of experience. The population living in cross-border areas amounts to 181.7 million (37.5 % of the total EU population), whereas all EU regions and citizens are covered by one of the existing 13 transnational co-operation areas. EUR 7.75 billion (2.5 % of the total) available for this objective is split as follows: EUR 5.57 billion for crossborder, EUR 1.58 billion for transnational and EUR 392 million for interregional co-operation. For the 2007-2013 period, the instruments to pursue these objectives have their legal basis in a package of five regulations adopted by the Council and the European Parliament in July 2006 (European Commission, 2006b). The fifth regulation introduces a European Grouping of Territorial Cooperation (EGTC). The aim of this new legal instrument is to facilitate crossborder, transnational and/or inter-regional co-operation between regional and local authorities. The latter would be invested with legal personality for the implementation of territorial co-operation programmes based on a convention agreed between the participating national, regional, local or other public authorities. Within the Territorial Co-operation priority the EU provides funding within the framework of its neighbourhood programmes for the territories lying by the external borders of the Union. Besides these the candidate countries will have access to the renewed pre-accession instrument (IPA), which also contains a sub-section for cross-border cooperation. Priorities Successful regional cross-border cooperation is achieved by a common development of priorities. These priorities should result in a process of finding common interests between the partners. Experience suggests that win-win situations for both partners are the best precondition for successful cross-border cooperation at project level, whereas idealistic motives often result in disappointment. Actual synergy effects and concrete financial advantages are the best incentives to engage in cross-border cooperation and to achieve tangible, sustainable long-term results. Priorities for regional cross-border co-operations could be: - Economic development - Improvement of the infrastructure 95
-
Common strategies for the development of tourism “People-to-People” activities on a broad scale to improve regional identification and interaction Human resources and education
A first step to cross-border cooperation is reciprocal orientation and information. The next step is defining common interest and possible synergy effects, while at the same time finding out about conflicting interests and approaches to cooperation. The final step is then to develop a common strategy and common targets as well as concrete cross-border cooperation projects.
2.3.2. Borderline developments in the neighbouring countries of Europe Recognising the drawbacks of the borderline location several European countries started to work on programmes to utilise the potential advantages of this specific location, and cross-border spatial development became an important area of regional strategy planning. During the evolution of European integration the cross-border cooperations have received increasing amounts of financial support, and in the 2007-2013 budgetary period crossborder cooperation became a top priority. The tolerance between neighbouring people has become a generally accepted norm in West Europe around 1960, and as a result of this the formerly traditional hostility between Germany and France started to disappear, not only on the level of the state but also on the level of private relationships, creating the possibilities for regional cooperation. Besides international organisations bilateral and trilateral state agreements also created frameworks for the transboundary regional cooperations (e.g. between Germany and Austria, or Germany-Switzerland-France), which lead to harmonised transboundary spatial projects. The unified planning process is hindered by the different relations in the neighbouring countries, in therms of public administration, decision making competences, and the slightly differing legislative systems, the linguistic difficulties, and last but not least the national priorities of spatial development (Erdısi, 2002). Cooperation takes place essentially in the following 4 levels: • • • •
State or federal level Regional level (federal state, canton, departement) local community level (towns and their suburbs) enterprise level. 96
The main fields of cooperation are: • •
• •
production and product chains, joint management of energy supplies, joint utilisation of infrastructure, international airports, maintaining conditions of water transport, joint water management, joint organisation of water supplies, cooperation in the environmental problems, maintaining the cleanliness of border rivers, protection against air pollution, Cultural and educational cooperation.
Main forms of cooperation: •
•
Formal cooperation, based on state level agreements, recommendations from governmental organisations and agencies, of which the implementation is controlled by state officials. Informal cooperation not supported by state level agreements (e.g. the conferences or cultural events organised by the initiative of local and regional planners).
The areas developed together are mainly development axes of supraregional importance, or approximately 20 to 40 km wider contiguous regions, agglomerations, development centres. Many examples of successful cooperation are known in West-Europe and in the Central and Eastern European region. The variety of such success stories is well demonstrated by the following examples, reports and studies describing the results of interregional cooperation throughout Europe: Ambrosi - Rener (2004), ATI CLES (2004a, 2004b), Baranyi Béla (2002, 2004), Bausch et al. (2005), Brand - Wolf (2004), Centrope (2006), Erdısi (2002), Flynn (1997), Gabbe (2005), Golobics (1996), Gren (2003), IDELE (2006), Koncz (2004), Kühl - Klatt (2004), Ó Maoláin (2000), VÁTI (2006b), Wolffhardt -Lutter (ed, 2005a, 2005b).
2.3.3 Borderline processes in Central and Eastern Europe Borders have always been barriers breaking the spatial continuity of society and economy and hindering or slowing down the free flow of products and information even in its liberalised and spiritualised forms. This was particularly true in the 20th century, when, referring to the independence of the nation states the countries formed their institution, rules and regulations autonomously and often utilising absolute power over their inhabitants. In such circumstances borderline location necessarily meant peripherality, the border was the end of the known world, and behind it the unknown and often unreachable was seen (Illés, 2000).
97
If it was true anywhere at all, then it was true typically for Central and South-East Europe. This was the part of Europe, where the importance and impacts of the borders have been remarkable. •
In this part of the continent the most of the countries are rather small and landlocked, with long continental borders separating them. From the Baltics to the Northern borders of Greece (that is, in the area surrounded by Germany, Italy, the three Eastern Slavic countries. Belarussia, Ukraine and Russia) there are altogether 18 countries, covering 13.8 % of the territory of Europe, with 18 % of European population, but the length of their borders is actually almost 60 % of the total lenght of the continental borders in Europe. Approximately 60 % of their area is of borderline locations, and 60 % of the total population lives in these areas. The same proportions for the European Union are only 21.5% and 15.2 % respectively. This means that the impacts of borderline location affects directly considerably larger proportions of the population that in the other countries of the European Union.
•
Borders have a specific character due to their extreme changeability. The totel length of the continental borders in the region is 16000 square kilometers. Of this only 420 km, that is, only 2.6 % is the part where neither the separation line, nor the national character changed during the 20th centrury: and this is the border separating Bulgaria and Romania, where the borderline is exacly the river Danube. 97.4 % of the border has changed, often for several times. On top of all this the borders have been modified several times during the last 10 years: due to the breaking up of the former federal states the length of the borders have increased by 50 %. The number of neighbours have also increased considerably and the remaining borders have radically changed their national character (the clearest example is Poland: in 1990 it had three neighbours, East Germany, Czechoslovakia and the Soviet Union. By now none of these states exist any more, while the number of neighbours of Poland has increased from 3 to 7 countries).
•
Finally the character of the borders is also important. The Iron Curtain was part of these borderes by the Czech Republic, Slovakia, Bulgaria and Hungary, which was the most important frontier between the capitalist and the socialist systems. Similarly impenetrable borders were the Western borders of the Soviet Union, but also the borders of the friendly socialist neighbours, which were also impassable in some time periods and areas.
•
Borderline cooperation has a particularly remarkable importance in this region. First of all because – as it was seen – the small sizes of the countries and the rather dense network of borders make it difficult to carry out development programmes and investment project which would not have any impact over the borders. On the other hand, although the relationships of the neighbouring countries have considerably improved in the last decade, they are still loaded with problems of currency values, customs duties, 98
security and property issues, ethnic and safety problems which create barriers against cooperation. The regional cooperation, however, due to the distribution of competences, is free of these problems, and can focus on topics of transportation, tourism, economic and business affairs in which there are no losers, and both partners would gain. It is not by chance that the cooperations implemented on a smaller territorial level, may have a leading role in establishing cooperation and partnerships in areas where the moving space for central governments is still limited. The best example for this is the Alpine Adriatic cooperation of regional governments – established in the 1970-es with the participation regions of countries belonging to NATO, or to the Warsaw Treaty and even unallied countries, which provided a basis for the cooperation of governments in the Pentagonale and the Central European Initiative later. The example of the Carpathian Basin In the case of the Carpathian basin the present borders have cut across formerly homogeneous regions (Hardi, 2004). The new borders crossed the regional, economic and transport connections as well as breaking up the linkages of centres and their zones of attraction not mentioning the ethnicity and nationality of the majority of the regional population. The emerging new states between the two world wars and during the socialist decades further strengthened the political separation roles of the borders. The political power in the neighbouring states tried to weaken the foundation of transboundary linkages in the new border regions by various measures: expatriation of the population, elimination of roads and railways, rearranging formerly established administrative boundaries, the weakening of the authorities of the formerly central settlements and the establishment of new centres, etc. This situation has created severe problems at both sides of the borders, in the development of the economy and society, changing borderline regions into peripheral regions. The neighbouring border regions have become very different by now regarding their development levels and development directions, partly due to the above reasons, and partly due to the general social and economic situation in their countries. This has created an interesting mosaic by the borders of the Carpathian Basin. Underdeveloped regions of the countries have neighbouring regions at their eastern and south-eastern borders which are considered developed within their countries, but are less developed than the underdeveloped regions of their western neighbours. This is the case with Austria and Hungary, or Hungary and Romania, or Hungary and Serbia-Montenegro. West-Transdanubia, the Western region in Romania or Vojvodina in Serbia are considered to be among the most developed regions of thein own countries, but they are poorer than Burgenland, or South-Alföld, which are, however, underdeveloped regions in their own countries. Successful cooperation between these regions can be imagined where at least by one side of the border dynamic growth and development with considerable economic potentials are expected. This may be strengthened by the ethnic relationships and the connections of the spatial structure. 99
Cross-border cooperations in Hungary For Hungary cross-border cooperation is of strategic importance. Comparing to our total area the lengths of our borders is large, a large proportion of our population lives in borderline regions – according to the EU standards, because 14 of our 19 counties have common borders to some of our neighbour countries (Enyedi, 1996). Several euroregions and euroregional cooperation have been initiated by the Hungarian borders in the past few years. Most of them were established after the declaration of the Madrid Convention mentioned earlier. The other motivation for initiating cooperation was the programmes established to support the development of borderline territories. PHARE-CBC was running by the Austrian-Hungarian border from 1995, and it has gradually expanded to all of the borders of Hungary. Although this programme provided only rather small amounts of support (2 to 3 million EUR/year/border), but the actual emergence of a resource for development encouraged the actors of the borderline areas – municipalities, local governments – to declare their willingness to cooperate. Unfortunately the operation of these organisations is rather contradictory. It is rather rare to see real activities in line with the declared objectives. Following the initial enthusiasm they are typically slowing down. In many cases following the signatures of the first agreements nothing else happened. The lack of success may be explained by three groups of reasons (Hardi, 2004). -
The size of the area and the existence of common interests
Cross-border cooperation is not a compulsory task for any local governments or other actors involved in spatial development. The participants take part in these activities on a voluntary basis without any fees or payment. Thus for the successful operation of these cross-border organisations the existence of the common interests will be the determining factor. The majority of such cross-border organisations was created as a result of political will. The approach of county and town politicians decided about the area covered by cooperations and not the territorial logic but the actual attitudes of the persons involved decided about the range and scope of the cooperating partners. At first it was an objective to cover the largest possible areas, thus the area and population of the Carpathian Euroregion is larger than that of Hungary, and it is more similar to an Alpine – Adriatic territory than to an euroregion. The extensive site causes two important problems: first, there is not much common interest among members living several hundred kilometres away from each other, and counties of that distance can rarely find common problems that they could resolve on their level of competences. Secondly, in these very large euroregions the organisation of a simple committee meeting takes a very long time, costs a lot of money and causes other organisational difficulties, which makes the joint activities practically impossible. It can be 100
stated that the enlargement of the territories of such cooperations will not lead to the extension of the competence levels of the members, and thus the overall capacities of the members are not suitable for resolving the true problems of such large territories. Thus it is advisable to fit the sizes of these organisations to the competence levels of the members. So the question is not whether it should be the settlements, microregions, counties or regions that should take part in such institutional cooperations. All of these have their tasks in transboundary cooperation, but the territory to be covered by the cooperation has to be chosen with consideration to maintain the common interests to be fitted to the competence levels of the partners. The loss of common interests of the parties does not happen only because of size but also because at the establishment of the cooperation and at the invitation of the partners the common interest and the complementarity in the capacities were not issues to consider. This resulted in much less common interest than would have been advisable. The above difficulties have been increasingly recognised in the organisers of the cooperation and with time more preference was given to the smaller organisations covering functional areas. -
The levels of competence possessed by the cooperating partners
The competence levels of the partners are often different. There are large differences in the levels of independence and authority of a Hungarian, Romanian, Croatian etc. leader of a county or settlement. This is a reason out of the decision making power of the cross-border organisation, and is defined by the national legislative systems. To harmonise these differences may be the result of the accession of all the involved countries to the European Union where there are signs of harmonisation in this respect. Another reason of the differences in the competence levels is the situation when the members entering the cooperation are from different territorial and regional levels at the opposite sides of the border. An example to that is the Triple Danube area (Hármas-Duna-vidék) Euroregion, where the Hungarian participants are counties, while the Slovakian partners are districts (parts of a county). It is also difficult to efficiently manage an international committee, when one of the partners is represented by a high level official of the central government, and the other by a local council member from a small town. The strong influence of politics is felt in the fact that the election cycles are somewhat shifted in the involved countries. This means that in any of the years one of the partner countries has elections. This means that the involved partner will wait until the results of the elections are known, and the whole cooperation is delayed. -
Resources and organisation structure
Considering the objectives, the territory and size of the population in the area covered by the cooperation, the resources are often very small. Among the countries surrounding Hungary Slovakia is the only one, where the 101
Slovak partner has access to national resources to support the participation in a cross-border cooperation. The money is sufficient for carrying out smaller tasks, that is, to prepare a strategic plan. Otherwise resources are created by the payments of the partners in the cooperation, and this amount is sufficient to maintain the management of the organisation. It is very rare that the resources are sufficient to desing a joint development plan. Several development plans have been prepared, but usually for only one side of the euroregion; that is, it was always the partner with some resources who could make plans for itself. Although to cooperate by common interests would naturally require the creation of one common plan covering the needs for every partners. Most of the euroregions do not have separate organisation. For the euroregions with such independent organisation body, there are responsible persons for the management and operations of the cooperation, and it was exactly these cooperations achieving real results. The future is probably for those organisations which are set up by the lines of common interest. Sooner or later some financial resources will be found to assist the cooperation. The first and probably the most efficient of such cooperations is the Austrian-Slovakian-Hungarian(-and Czech) cooperation called Centrope project, with the aim of re-establish the attraction zone around Vienna. The cooperation was established in the autumn of 2003 with the headquarters in Vienna. Its area covers South Moravia, Bratislava and Trnava counties in Slovakia, then the Hungarian counties Gyır-MosonSopron and Vas, and Vienna, Lower Austria, and Burgenland. The cooperation is built mainly on the attractivity of Vienna. There is a good chance of the region to become one of the most dynamic cross-border regions of Central Europe. Its establishment was prepared by studies of the attraction zones and the objective is to enhance the economic development in the area, and to utilise the complementary opportunities in the borderline regions and create a large urban space. The project is supported by considerable amount of funding from the European Union (Centrope, 2006). As it was shown above the establishment of transboundary regions depend on many factors and conditions. Neither the opening and liberalisation of the borders, nor the transboundary institutional structure is sufficient in themselves to create a homogeneous area. It is no accident that at the German-Dutch border, where cooperation has a much longer history than in Hungary, the partners are still searching the methods of dynamising the further cooperation, and it often happens that the partners cannot achieve anything else than a few dinners together and the organisation of a few cultural programmes. The joint impacts of may factors are needed to initiate real important and sustainable cross-border activities. The Carpathian Basin is an optimal area for this: the borders are young, they have not modified the economic and social space to a great extent, and thus the mutual interests are still present, there are opportunities for joint utilisation of institutions, which could become the engines of cooperation. The establishment of such networks can considerably increase our common strategic roles together with our neighbours within the European Union. This means that the transboundary regions and the cooperation networks in the Carpathian 102
Basin can create a starting point for a fast development path for the countries living together in the area. These cooperations can contribute to the common and more efficient utilisation of the resources available in the region, for which careful planning and development of the cross-border regions and cooperations are needed.
Figure 2.6: Eligible areas for cross-border cooperation in the Eastern and South-Eastern regions of the EU-27 in 2007-2013 Source: http://ec.europa.eu/regional_policy 103
Figure 2.7: Eligible areas for transnational cooperation in 2007-2013 in the Eastern and South-Eastern regions of the EU-27 Source: http://ec.europa.eu/regional_policy
2.4 Working Communities and Euroregions – Examples
2.4.1
The Alpine-Adriatic Working Community
In 1978 when Europe was still divided, the representatives of two northeastern Italian regions (Friuli-Venezia Giulia and Veneto), and four Austrian provinces (Carinthia, Styria, Upper-Austria and Salzburg) and Bavaria, Slovenia and Croatia decided in Venice to form an action association for harmonising different fields of regional development. In 1981 Trentino-Alto Adige, in 1985 Lombardy joined, later, in 1987 the Austrian Burgenland joined, and between 1986-89 five Hungarian counties (Gyır-Sopron-Moson, Vas, Zala, Somogy and Baranya) entered the cooperation and took part in the work of the interregonal organisation. With the admission of the Swiss Ticino canton in 1990 the organisational foundations of the Community became established (Horváth, 1993; Cappellin, 1993). The tasks of the Community were formulated in the founding Joint Declaration (Venice, 20 Nov 1978), as common informative, professional discussion and harmonisation concerning problems falling within the interest of the members. The following areas were emphasised: • • • • •
Transportation junctions through the Alps, Traffic at ports, Energy production and transportation, Agriculture and forestry, Economy and water supply, 104
• • • • • •
Tourism, Environment protection and nature conservation, Landscape planning, Development of settlements (towns and villages), Cultural relations, Relations between academic and higher educational institutions.
As the participants declared several times, the programs correspond to the European regulations and their activity represents national and European interests. The national governments expressed their willingness in promoting the interregional cooperation within the Alps-Adriatic space. In 1990 the Standpoint of the Pentagonale Initiative unambiguously pointed out in Venice that the cooperation of the provinces needed encouragement. Thus the political preconditions were favourable for guaranteeing that the Alpine-Adriatic Working Community could become the integrator between the European Community, the EFTA, and the regions of Eastern Europe. The core and periphery in the Community The Italian and the German regions have decisive weight in the Community of 280 thousand square kilometres, 38 million inhabitants. 40 percent of the population and 42 percent of the GDP of the Community belongs to the Italian regions, and 29 percent of the population and 39 percent of the GDP to Germany. There are great differences in the economic performance and productivity as well as the sectoral structures of the member provinces. Thought the Eastern peripheral provinces are developed regions within Hungary, Slovenia and Croatia, their GDP (or rather GRP – Gross Regional Product) indicators are below the average of the Community as a whole. While the sectoral structures of the core regions are characterised by the typical sectors of postindustrial society (the share of the tertiary sector being higher than 50 % - while in the less developed provinces it is hardly higher than 40 %), the share of agriculture is still high in the peripheries. The development paths of the rural areas are determined by the characteristics of the postindustrial society, namely the development of the service sector, which is spatially more mobile and sets new location requirements and has become the engine of economic growth. The economically developed regions have modern physical infrastructure, the density of the motorway network is higher than the EU average. The majority of the provinces have been connected to the European air traffic network. Significant development can be observed in the other service industries, with growing numbers of employees and growing production value. Again, the typical structures of the core and periphery regions are found: while in the peripheral regions the tertiary sector is mainly commerce and tourism, in the core regions financial services, research and development, as well as the production services are the most important. In the 1980s there was an significant reorganisation in the industrial sector of the core regions, the traditional industries declined and the production of microelectronics, biotechnology and information technology became the leading industries. The traditional clothing industry and food industry 105
changed from mass production to diversified quality production, as the example of the Benetton company in Veneto shows. Parallel with the economic restructuring the sizes of the enterprises also changed significantly. Although the SMEs have always characterised the Alps Adriatic regions, they became predominant and the number of enterprises have rapidly grown in the core regions of the Working Community. The market institution system has also undergone a considerable expansion, and the consulting firms, marketing, and information service organisations helping the market access of SMEs have also developed significantly. During the first decade of the Alps-Adriatic Working Community its main role was to exchange information, coordination of linear infrastructure and organisation of cultural relations. Later – partly due to the transition of the Eastern European countries and the capital expansion of the Italian regions, the professional exchange meetings of economic organisations of the member provinces became regular events. The development model of the core regions The development model of the core regions of the Alps-Adriatic Working Community shows a number of individual peculiarity as well as a lot of common characteristics. The major part of the regionally specific characteristics is rooted in the variety of regional policies and in the social and economic positions of the regions within their countries. While the Italian regions are among the most developed regions of the country, Carinthia, Burgenland and the eastern border zone of Bavaria are relatively less developed in their countries, and receive significant government subsidies. In some of the regions (Styria, Upper Austria) the decline of heavy industry created recession, while in Rovigo (Veneto region) the decline of the sugar industry caused difficulties. Naturally, he development of these areas required individual solutions, and the development processes do not follow traditional models, but the innovative elements are emphasised. In these regions a new model of regional policy has been applied, which may be called innovation-oriented, focusing on the systematic renewal of marketable products industrial processes and services. Therefore this model enhances the development of the adaptability of the regions. The local and regional decisions are no longer determined by ventral standards, but by local-regional decisions based on market and business cylce signals. The common goals of these strategies can be outlined in the following way: - search for and classification of new development resources, creation of institutions necessary for the operation of this system, - building regional, local and entrepreneurial cooperation networks (as in the example of the industrial Italian regions, where traditional entrepreneurial cooperation has been combined with breaking down the production process into spatially separated phases), - institutionalisation of information, innovative and entrepreneurial incentive transfers (industrial parks, business innovation centres, R&D consortiums), 106
-
organising local and regional development coalitions of various interest groups, harmonising rigid local hierarchies, and building flexible decision systems, transforming the quality of living neighbourhoods, their cultural and scientific atmosphere and favourable environmental status into economic growth factors and the complex settlement supply into capital attraction factors.
General conclusions of the Alps-Adriatic Working Community The history and evolution of the Alps-Adriatic Working Community and the work of its expert committees leads us to some conclusions. These experiences may offer orientation for the regional cooperations in Central Europe. The main conclusions are the following: -
-
-
The Working Community was built up gradually. In the first phase the formerly existing intensive bilateral relations helped to establish cooperations within the Community. An important organisational principle was theat only regions with national borders were allowed to become members. The limitations on the final number of member regions had to be considered seriously. The Working Community shows clearly that organisations with more than 15 members is much harder to operate than smaller communities. With the gradual buildup the initially existing differences of interest are easier to harmonise. The founder regions and the core regions of the Working Community organised regional cooperation at a time when their economies reached the above mentioned development path. Developing international cooperation became an important element of the internal regional policy of the member regions, the regions helped in increasing the competitiveness if their business organisations with their own resources, too. This process went parallel with the integration process of the European Union. A specific motive of this Community is that its members are considered the most dynamically developing regions in their own countries and they play an outstanding role in the bilateral foreign trade relations of their countries. The interregional cooperation extended the limits of formal relations, when the market actors established their own cooperation networks, the collaboration of various types of marketing organisations had been institutionalised, and they had developed their own fields of force, which did not need administrative coordination any longer. The institution of the expo and trade fair cities, chambers of commerce, business and entrepreneurial as well as technological centres, airports of the Working Community are in contact with each other – although in Eastern regions, where the institutions are not fully developed, the role of administrative institutions is still stronger. Thus public administration has general political and coordination role, while the dense network of real cooperation has to be established by market actors.
107
-
-
The general task of the regional administration is to represent and defend the interests of this cooperation for the central government. Organising the Alps Adriatic Working Community was not free from conflicts between the central and the regional interests either. One of the factors of conflicts was the different level of autonomy and decision making capacity of the regions and provinces of the Working Community. Constitutional debates flared up after the Council of Europe in Madrid reached an enabling agreement pointing out the necessity of decentralised organisation of transboundary cooperation. After the ratification of this agreement by the national governments, further national laws were passed, in the countries of the Working Community. As the example of Hungary shows, the reform of the regional and administrative structure of a country is a condition to realize an innovative regional development strategy and establish international regional competitiveness. Without this member provinces are unable to fulfill their role in the international division of labour or to be equivalent partners of the more developed regions.
2.4.2 West-Pannonia Euroregion The West-Pannonia Euroregion was established on 7 October 1998 as an agreement of the province Burgenland (Austria), and the counties GyırMoson-Sopron and Vas (Hungary), and three Hungarian towns of countylevel administrative category, Gyır, Sopron and Szombathely. The council of the euroregion accepted the Hungarian county Zala as its member on 21st June 1999. The primary objective of the euroregion is to enhance the establishment of a unified Europe in the Austrian sense, in a relatively small area. The base of the euroregional cooperation is the economic, social and cultural cooperation, and increasinly the development of the infrastructure whithin various projects (Koncz, 2004; Rechnitzer, 1999). Both sides of the partner regions consider the intensive cooperation very important in the following areas: • • • • • • • • •
Spatial development, consolidation of the spatial structures, transport and information systems, Economy, Tourism, Culture and other common values, Nature, environment and water protection, Safety, security and catastophe relief, Health and social affairs, Education and youth programmes, Employment.
In the framework of this regional cooperation the efficient management, coordination, and monitoring of implementation are of crucial importance.
108
The actual work is done in working committees, of which the most important one, that is, the one dealing with economic and spatial development belong to the direcion of Burgenland. Gyır-Moson-Sopron county is responsible for the issues of environmental protection, education and youth affairs, county Vas deals with tourism, culture and employment, while county Zala manages the working committee of safety, security, catastrophe relief and the health and social issues. The working committees are set up and a few important projects are being designed, which define the main tasks and activities of the near future. The work programme accepted for the year 2001 included – beside other objectives – the coordinated development conception for transportation (roads and railways). Besides it also emphasised the importance of the rehabilitation of steppe and water habitats in the nature reserve area by the Neusiedler lake, and a cooperation of industrial parks and technology centres, coordinated actions in the development of medicinal and thermal spas, and the definition and outlining of unified principles for the operations of the whole euroregion. The transportation development ideas of Burgenland are focused on fulfilling the above aims. The general opinion is that the new situation after the accession of Hungary, Slovakia and Slovenia to the EU will have large impacts on Burgenland’s transportation development strategy, and on the projects that use the financial resources coming from the Structural Funds of the EU. Thus in 2000 the province updated its transportation strategy of 1994, and the new version, besides the interests of Burgenland, pays special attention to the needs and interests of the counties in Western Hungary. The 2000-2006 programme of Burgenland contained the following main components: • To make Burgenland a modern central European region. • To prepare the development of the West-Pannonia Euroregion. This euroregion includes Burgenland and three Hungarian counties, GyırMoson-Sopron, Vas and Zala megye. In the attraction zone of this area there are two more borderline zones, namely that of Austria – Slovakia and also Austria – Slovenia. After the enlargement of 2004 the whole area has been expected to become a common economic and social space. • Special attention should be given to the regional disparities within Burgenland, and the elimination of these disparities, namely: - The improvement of the economic performance of the area, and the decreasing of the developmental disadvantages, and the improvement of the competitiveness of the province, - The establishment of a technologically modern, high quality economic structure, the improvements of professional qualifications, and the increased levels of output value by employee. - The maintenance of the importance of environmental and nature protection considerations. - Equal opportunities of men and women in all areas of the economic and social life. The most emphasised element of the first programming period of 1995 –1999 were the improvement of infrastructure, the creation of employment 109
opportunities in high value areas, and the definitions of new directions for the economy in Burgenland, by developing technology-intensive production and services. The second programming period of 2000 – 2006 has to continue this path, with the addition of the following aspects: • To emphasise the technology orientation in all production programmes and measures. • To put particular emphasis on the small and medium size enterprises and the creation of new enterprises. • To establish and support the networking and cooperation of enterprises. • To utilise the most modern technologies in the re-regulation and positioning of the economic structure of Burgenland with consideration to the ecological aspects. The precondition for the success of these programmes and the achievement of the objectices is the proper connections of Burgenland to the international transportation networks. First of all the construction of good quality roads are needed to create connections to the main motorways and superhighways of the European road network, and also the establishment of connections to the main Hungarian centres involved in the programmes. For the achievement of these targets joint and harmonised actions and measures are needed on national and provincial levels, too. By the end of the second programming perion Burgenland has to achieve that the GDP/person value of the province should be raised from the current 73 % of the EU average to 77 %. At the same time it must be considered, that in the third programming period starting from 2007 Burgenland will not be entitled to supports within the framework of Objective 1 of the EU. To enhance the development of the regional economy the establishment of multifaceted connections of the attraction zones by the Vienna-BratislavaGyır-Sopron axis may provide new opportunities.
2.4.3 The Carpathian Euroregion and the Duna-Körös-MarosTisza Euroregion Due to the interregional organisations, most of all in Western Europe, but occassionally in the eastern part of the continent, too, the so-called euroregional viewponts gain importance. According to this viewpoint the future Europe will not only be an Europe of nation states, but also the Europe of regions created from the (borderline) areas of common economic interest (Éger, 2000). The institutional cooperations for transboundary cooperation have been established at practically all borders of Hungary. Since the signature of the Madrid Agreement (1980) a cooperation wave has run over the borderline areas of Hungary. The peak of institutionalising the cooperation has been the organisation of euroregional cooperations (organisations entitled to use 110
the name euroregion even if they do not cover areas bordering the EU). Two types of the euroregion may be distinguished according to the size, territory and connections. One of them is the so-called macroregional model, the other is the microregional one. The first can also be called province or county-level model, because it usually covers the middle level administrative territorial units (provinces, regions at the NUTS II level, or counties at the NUTS III level) of two or more neighbouring or nearby countries, establishing a large area of euroregional organisation (e.g. the Carpathian Euroregion). The other model may be called the model of urban attraction zone, where this small euroregion relies on the direct cooperation of microregions (NUTS IV level), or planning for the microregional level it creates closer cooperation in the smaller scale, while preserving the main strategic elements of the macroregional model (Rechnitzer, 1997, Baranyi, 2004). Besides the problems hindering the efficient cooperation of the newly institutionalised transboundary cooperations, a basic problem is caused by the territorial aspect of the newly born euroregions. The newly established euroregions rarely cover real functional border regions. Although there are positive examples (e.g. the Kosice-Miskolc euroregion) it has been still more typical since the establishment of the earliest enormous euroregions (Carpathian Euroregion, Duna-Körös-Maros-Tisza Euroregion) smaller areas of cooperation are established by the eastern borders taking into account the real spatial connections of the border zone (Interregio, Bihar-Bihor Euroregion). The explanation in the background of these positive processes is the fact, that the microregions and settlements at the opposite sides of the border have recognised the opportunities arising from the common interests of these territories cut up into pieces after the Trianon treaty, and especially the advantages of local cooperation in spite of the existing barriers created by their nation states, and the advantages in the similarities regarding geography, spatial structures and ethnic composition of the population. This is particularly true for Hungary, because here the political borders have severely broken up the traditional functionally connected economic spaces (Golobics - Tóth, 1999). In Hungary there are three euroregions – not mentioning the Alpine-Adriatic Working Community described before – on the macroregional level, which represent the highest level of transboundary cooperation. These are: the West-Pannonia Euroregion mentioned above, the Carpathian Euroregion and the Duna (Danube)-Körös-Maros-Tisza Euroregional cooperation. The Carpathian Euroregion is the oldest such cooperation in Hungary, and it covers the north-eastern region of Hungary. This giant euroregion is a special form of transboundary cooperation in many respects. It differs from the other two Hungarian euroregions (the West-Pannonia euroregion and the DMKT euroregion) in many characteristic features. The first important difference is that instead of the traditional bilateral system of relations the Carpathian euroregion created a multilateral preintegrational group, thus organising the connections of not only two countries, but of the neighbouring counties of five countries. The other specific feature of the cooperation is the fact, that all the partners used to belong to the socialist countries in the past, and all are also Central and Eastern European 111
countries. The Carpathian Euroregion is a form of cooperation that did not have any EU-member neighbours at the time of its establishment, so it was formed around the external borders of Europe, which was an interesting model for the West, too. The third important factor was the fact, that the whole area of the Carpathian euroregion is considered peripheral by European standards, and the individual territorial units belonging to it are also considered peripheral in their own countries (Baranyi et al., 1999; Rechnitzer, 1999). The DKMT euroregion established an institutional framework for the cooperation of 9 counties or provinces of three countries, Hungary, Romania and Serbia. The total area of the euroregion is about 77 thousand square km, and it is similar to the Alpine-Adriatic Working Community and the Carpathian Euroregion, that is, it could be considered a multiregional organisation. However, the declared objectives require closer and more target oriented cooperation and its operations are closer to the classical euroregional activities of three countries of common borders. The importance of this organisation is increased by the fact, that it covers regions of high political risk due to the war in the Yugoslavian territories. The DKMT Euroregion has learned from the experiences of the Carpathian euroregion, and tried to avoid the traps of national politics, and it declared even in its foundation document that the main objective is the establishment and enhancement of cooperation entirely on the local regional level, between local authorities (Rechnitzer, 1999; Éger, 2000; Baranyi, 2004). Experiences of the cooperation The opinions about the results of the cooperation within the two large macroregional cooperations by the eastern border of Hungary are rather doubtful, and most of the problems mentioned are related to the operations of the Carpathian Euroregion. The criticisms refer to the multiregional character, large territory and giant size (161 000 km2, 16 million inhabitants) which make it similar to a medium size country, the more that two dozen administrative territorial units, many of them are not borderline units, would be enough in themselves to prevent the operations of the organisation. The large size and other problems and contradictions, partly inherited, and partly related to the new historical – ethnical or economic – social conditions, have made it a formal institutional framework in which mainly formal events related to protocol, culture, politics and foreign affairs take place occassionally without real functions and achievements. The weaknesses and inefficiencies of the organisation have been discussed and analysed many times (Illés, 1993). It is worth emphasising the final conclusion of its operation, that from the very early times of its establishment opposite effects hindered its success, namely the disputes on the national level of the central goverments, and the willingness of the local policy makers initiating cooperations, which resulted in a network of tensions (Éger, 2000). It is also true for the much more efficient DKMT Euroregion, that the large territory causes difficulties in the cooperation in itself. The area of the DKMT Euroregion is 77 000 km2 and it has a population of nearly 6 million. 112
However, this is still a lot more manageable size than that of the Carpathian euroregion, not mentioning the fact that the four Hungarian, the four Romanian and the one Serbian counties represent a much closer and much more target-oriented approach than the Carpathian euroregion, having a more homogeneous geographical and economic-social character. Even in its historical past in the Austrian – Hungarian Monarchy this area was a more dynamic and more developed area than the present Carpathian euroregion. The example of the two macroregional transboundary cooperation may cooperate at any levels of territorial units and sizes but the really efficient form of transboundary cooperation is the smaller, microregional cooperation which may be a redefined element of the macroregional frameworks, too (Éger, 2000).
2.4.4 Mini-regions and other levels of cooperation In transboundary cooperation, besides euroregional organisations – or within the framework of those, too – the crucial role is the role of the microregions of the border region, or the associations of these micoregions, and most of all, the large towns and cities in the vicinity of the border, that is, the socalled centrum towns. This is the reason why it is so important to establish not only macrosize euroregions but also cooperations of borderline settlements, urban associations or microregional partnershipes. In this dimension the challenges the region faces, can be best answered by regional central towns, and para-centres, although their present level still differs. By the north-eastern borderline of Hungary – and partly by the eastern and the southern regions, too – rings (circles) of towns of similar size and similar role are found at both sides of the border, and being complementaries to each other. To establish a network of cooperation for these towns – starting with the reconstruction of their infrastructure – could boost the transboundary cooperations of the region. The first of these organisations within the area covered by the Carpathian euroregion was the INTERREGIO trilateral microregional cooperation (founded on 6 October 2000) as a cooperation of counties Szabolcs-SzatmárBereg (Hungary), Satu Mare (Romania) and Zakarpatia oblast (Ukraine). The new organisation was originally a programme region within the Carpathian Euroregion, with the objective of enhancing the cooperation of the relevant countries. The objective of the INTERREGIO is to establish and develop cross-border relationships of the covered counties within the framework of the Carpathian Euroregion, by establishing joint cooperation projects at the level of the local municipalities. The targeted activities include the development of overall infrastructure, the protection of the nature and the enironment as well as the water base of the region, the developent of the economy, tourism, education and training, the development and maintenance of the inter-ethnic relationships and the common cultural inheritance. The cooperating partners provide assistance to each other in the planned joint developments, which are designed to become common values, but are mainly bilateral activities in reality, and for which the financial resources will be provided by the partners’ own resources and some other 113
funding. The basis for cooperation is the linkage of the three central towns of the regions involved (Nyíregyháza-Uzghorod-Satu Mare). Of the newer cross-border organisations it is the Hajdú-Bihar-Bihor Euroregion and the Bihar-Bihor euroregional organisation that can be considered de facto euroregional organisations. The foundation declaration of these organisations was signed and accepted in 2001 by the leaders of the neighbouring county councils, microregional associations, towns and villages involved. The Hajdú-Bihar-Bihor Euroregion connects the former historical, natural and geographical resources on the county level, while the BiharBihor Euroregion – with the centre Biharkeresztes – manages the cooperation on the microregional level relying on the existing centres and their attraction zones. The foundation agreement of the latter declares, that the organisation is open, and any municipality, association of municipalities, any non-governmental organisation or non-profit enterprise, which is located in either the county Bihor in Romania or the county Hajdú-Bihar in Hungary, and is willing to accept the objectives of the cooperation with the related responsibilities and rights of the members. The microregional level euroregional cooperation relies heavily on the bilateral relationships and based on the microregional level, will transmit the spatial relationships of the region in a closed form, while preserving the main strategic elements of the macroregional cooperation (Baranyi, 2000). The Interregio covering the Hungarian-Romanian-Ukrainian and the Hungarian-Romanian borderline areas is younger than the Bihar-Bihor euroregion, but they have a common trait, namely, that in their territory the institutionalised cooperations were preceded by the borderline cooperations of enterpreneurs in the form of borderline business zones. The beneficial effects of the economic-social or even cultural cooperation in the crossborder regions of Romania and Hungary have already been felt. The establishment of the business connections will lead to the emergence of a multiplier effect and the impacts of the businesses settling in the centre of the region create positive effects on the development of the economy throughout the region, even into the peripheries and over the borders of the microregion.
114
Chapter 3 - Peripheral regions, and crossborder cooperation programmes in Hungary 3.1 The development of borderline regions before and during the transition 3.1.1 Geographical position of Hungary within Europe Hungary is situated in the centre of the Carpathian Basin, and neighbours seven countries. Four of the border countries, Austria, Romania, Slovakia and Slovenia, are the members of the European Union, thus altogether 1590 km of our borderlines are the internal borders of the EU. The prospects of Croatia are good for the accession to the EU, while in the case of Serbia and Ukraine no such expectations are realistic in the spring of 2007. Thus Hungary has become a „gateway country” of the EU in the directions to South and East-Europe. Currently 656 km of external borders of the EU belongs to Hungary, of which only 164 km remains in the south and 137 km in the east after the Croatian accessions. It is a specific characteristic feature of our borders, that over the border, in the vicinity approximately 3.6 million Hungarian minorities live, with whom the motherland has to maintain good relations. The Hungarian minorities over the border may become the important intermediaries of the borderline economic and social relations, which may lead to a new kind of communication zone by our borders, and may become a driving force of rising from the formerly peripheral conditions. By the free movements of factors of production may contribute to the natural evolution of the borderline relationships, the European regional policy also encourages transboundary cooperation by several project opportunities. There is funding for cooperation with non-member countries that have already received the associated member state, and it is beneficial for the situation of the minorities. The often hostile, or at least unfriendly central governments or the state institutions will have to improve their relationships in order to have access to these development funds, and by tolerating closer connections of the minorities and their motherland over the border, will enhance the political stability of the region, and on the other hand, contribute towards the establishment of new, decentralised relationships. The cooperation between borderline regions by the Hungarian borders have two faces: on the one hand these strengthen the European integration by encouraging the cooperation of EU-member and non-EU-member regions, and on the other hand it establishes forms of cooperation for Central Europe, which may serve the development of the formerly underdeveloped regions (Rechnitzer, 2001). 115
The border regions and peripheries Hungary has 7 neighbour countries, and out of its 19 counties there are only 5 that have no borders common with other states (Veszprém, Fejér, Tolna, Jász-Nagykun-Szolnok, Heves). Austria has a 356 km – long common border with Hungary, by Gyır-Moson-Sopron and Vas counties. Slovenia lies by the borders of counties Vas and Zala, the length of the border is 102 km. Croatia is situated by the borders of Zala, Somogy and Baranya counties, of 355 km. Serbia-Montenegro lies by Bács-Kiskun, Csongrád and Békés counties, in the length of 164 km, while Romania neighbours Békés, HajdúBihar and Szabolcs-Szatmár-Bereg counties, on 448 km, while Ukraine has just one Hungarian neighbour county, Szabolcs-Szatmár-Bereg at a length of 137 km. Slovakia borders practically all of the northern borderline counties, that is, by Borsod-Abaúj-Zemplén, Nógrád, Komárom-Esztergom and GyırMoson-Sopron counties, the length of the common border is 679 km (Rechnitzer, 2001; Baranyi, 2004).
Figure 3.1: Border microregions in Hungary Source: Authors’ own construction According to the definition of the EU, borderline regions are NUTS III regions – that is, counties in Hungary – lying by the borders of the nation state. When a more refined scope is needed for the analysis, on a smaller scale borderline regions are the statistical microregions that lie directly by the state border, where a border station has existed (regardless of its current operation). Currently there are 168 statistical microregions (NUTS IV or LAU2 level units) of which 32.2 % of the territory of the country may be considered borderline region, covering 28.2 % of the total population of the country, that is, 2.9 million inhabitants (Rechnitzer, 2001). Borderline areas are usually considered peripheral, which is described by transport connections broken at the border, the large distance of the centres and the lack of transit traffic, as well as the limitations of trade relationships. In these peripheral regions the proportion of „cul-de-sac 116
settlements” is higher than the national average, the developments are delayed or cancelled, there are no good job opportunities and incomes, and as a result, the population tends to emigrate, the area is depopulated. The only exceptions are borderline areas with dynamic cross-border traffic, or when transit roads cross the region, which usually leads to more dynamic economic performance. During the period of the socialist state the borderline regions of Hungary were typically peripheral, although the extent of underdevelopment was different by regions. By the western borders the „iron curtain” prevented any kind of cooperation with the neighbours. During the centralised leadership it was not possible to establish spontaneous cross-border cooperations with the socialist countries either. The procedure of establishing cooperation was very strictly centralised. When the idea of establishing cooperation was born on the local level, then it had to be presented to the central authorities of the two countries. If the authorities considered it acceptable, then the neighbouring countries established connections with the party and government authorities of each other by the usual procedures of diplomacy. If the idea was still acceptable at that level, then the government authorities of the two countries gave the permission to the leaders of the involved counties or towns to establish the cooperation. However, the maintenance of these relationships was strongly dependent on the state level relationships of the two countries, and the deterioration of these could easily loosen up the cross-border ties, too (Tóth, 1996). Another barrier against the development of cross-border relations was the large Hungarian minorities living by the opposite sides of the border, and the neihbouring states rather neglected the cooperation in order to avoid disputes over the minority issues. The majority of cooperation linkages were mainly of the cultural or town twinning character, the initiation of spontaneous market-oriented or business relationships were unrealistic.
3.1.2 Borders before the transition During the times of the centralised socialist state the various pieces of the borderline had the following typical features (Rechnitzer, 2001): Hungarian-Austrian border: Up to the 1960-ies this border was practically a dead border, without any cross-border relationships. The development of the transboundary relations started in the 1970-ies, with the emergence of tourism, and shopping tourism by the end of the decade, and later be the establishment of institutionalised cooperation. By the 1980-ies dynamic cooperation was seen in the region, including production relationships, connections on the level of households, and also illegal labour migration. After 1989, the demolition of the iron curtain and the introduction of the world passport for Hungarian citizens a new period has started in the development of the border region, resulting in the region losing its peripheral character and getting closer to the development level of the most developed territories of the area.
117
Hungarian – Slovakian (Czechoslovakian) border: This is the longest foreign borderline of Hungary. The exact position of the border has been corrected several times since the end of World War II. After 1945 several tens of thousand Hungarian people were expatriated from Felvidék (that is, the montaneous area in Slovakia, near the Hungarian border which once used to belong to the Hungarian kingdom). The civilian rights of the Hungarian nationalities were severely restricted by the Czechoslovakian authorities, and this fact actually prevented any kinds of linkages between the two countries up to the end of the 1950-ies. After the 1960-ies slow progress was experienced in the cooperation of the borderline regions. Within this the western (Danube) borderline and the easternSlovakian border zones are worth distinguishing. The Danube borderline is characterised by the emergence of a potential transportation and industrial zone, including the free movement of labour, the cooperation between agricultural cooperatives (e.g. during harvest) and the increase of shopping tourism in the borderline towns, as well as the progress of general tourism, directed towards the internal resort areas of the two countries (Balaton, High Tatras). However, the conflicts related to the Gabcikovo-Nagymaros hydropower station also belong to this border area, which had led to political conflicts and disputes between the two countries. The eastern Slovakian borderline, at the same time, is a typically peripheral agricultural region, although in particular locations the heavy industry (steel industry and machinery manufacturing) encouraged cooperation between Hungary and Slovakia. The relationships between the towns of the borderline were limited to shopping tourism except for the two central towns/cities of the two border regions (Kosice and Miskolc). By the end of the 1970-ies the common development strategy of the borderline was declared in a joint document on institutionalised level (including the development of transport and traffic, economic development and water management), but the economic difficulties emerging after the transition, and the disputes related to environmental conservation and political conflicts prevented the implementation of this strategy. Hungarian – Ukrainian (Soviet) border: The Hungarian-Soviet border was practically a closed border before the transition, because the Eastern Carpathians were outstanding strategic and military zone for the Soviet Union. The Soviet military presence, as well as the worries about the Hungarian influence over the Hungarian minorities living over the border prevented the willingness of the Soviet partner to establish any kind of linkages with Hungary. There was only one border crossing station at the border, by Záhony, which was a road and rail border station as well, and also a switchpoint between wide gauge rail and narrow gauge rail systems. Hungarian-Romanian border: The continuous quarrels between the two countries and the permanent restrictions of minority rights have practically made any kind of cross-border cooperation impossible. The areas of Hungarian minority by the Romanian side of the border, which could have been the base for a lively cooperation, has practically become the main barrier to it. The Romanian government of the time has made great efforts to change the ethnicity of the region and 118
instead of encouraging the cooperation over the border made strict administrative measures to prevent even the civilian connections. Hungarian-Serbian, Croatian, Slovenian (Yugoslavian) border: Due to the political conflicts the border was practically a closed, dead border during the 1950-ies and 1960-ies. From the 1970-ies the differences diminished and the relationship of the two states started to improve, with positive impacts on the borderline connections. Various forms of agricultural cooperation (e.g. food processing), shopping tourism in the borderline towns of both sides of the border have emerged and developed. Dynamic cooperation has been established between county Zala and Slovenia, while the Croatian borderline is characterised by cooperation between towns, and in Vojvodina, Serbia the institutional linkages have been most developed. After the transition the role and situation of the border regions have changed considerably. Due to the processes of spatial restructuring some of the borderline areas lost their importance, others started to develop at a high speed. It can be generally stated, that regions could grow out of the former peripheral situation only if their location was close to development centres, and had access to better economic conditions and employment situation when forming its borderline connections. The advantageous position was gained by regions being less underdeveloped in their own countries, and at the same time they could start on a development part utilising the impacts of modernisaton processes. This meant that the two regions that the border separated were not regions with permanently disadvantaged underdeveloped conditions, but regions with considerable development potentials, which could give each other further developmental energies and initiatives. The border regions being underdeveloped and peripheral areas within their own countries could not transmit such mutually multiplying energies to each other, but being „peripheries of peripheries” (Baranyi, 1999; ErdısiTóth, 1988) were left out of modernisation processes, and became lagging behind, struggling with permanent structural crises. Thus, in the years of the transition the differences became strongly marked among the various borderline areas. Comparing the development indicators of these regions the Austrian-Hungarian borderline is outstanding with its very favourable development parameters, which are generally higher than the overall Hungarian average, and it can be shown that the economic dynamism of the area is the result of the cross-border cooperation and multidimensional relationships with the regions over the border. The situation of the Slovenian borderline is similarly favourable. However, the Romanian, Ukrainian and the eastern Slovakian border regions have remained peripheral, their economic and social indicators are far below the national average. These borderline regions cannot receive developmental energies from each other over the border. There are no significant comparative differences among the factors of the economy. At the end of the 1990-ies there is available labour at both sides of the border, but no job opportunities; there are production resources, but due to the lack of capital, they cannot be mobilised (agricultural and natural resources), the capacity of the communication network is insufficient (border crossings, road and rail 119
network), and this is a considerable barrier to cooperation as well as the different institutional and legislative systems and the instability of the economies (currency exchange rates, and inflation) (Rechnitzer, 2001).
3.1.3 The problems of transition in the border regions The development processes of the various border regions have shown rather specific and different characteristics since the transition (Rechnitzer, 2001). Austrian – Slovenian border region: This region is considered to be a winner of the transition, undoubtedly. The geographical location of these borderline areas have become highly valuable after the transition, privatisation was fast, the inflow of foreign direct investments quickly modernised the manufacturing sector. The emergence of small and medium-size enterprises in the region took place together with the development of the service sector and the diversification of the economic structure of the region. At the same time the local and regional markets have shown dynamic progress, and the income generating capacity of the regions increased, which was supported by the shopping tourism and tourism coming for consumer services. The establishment of the West Pannonia Euroregion in 1998 has further enhanced this process. The Slovakian border region: Within this region the Danube area and the eastern Slovakian border region show considerable differences, as is shown below. The Danube area: The Vienna-Bratislava-Budapest innovational axis offers development opportunities for the region. The former key activity, the mining industry has lost its importance, and the reconstruction of the industrial area by the river Danube has been slowly started. The functions of the centres have started to extend, though slowly, and in the second half of the 1990ies the full range of services has not been established yet. The relationships are intensive mainly in the household sphere, and at the border crossing points (in Komárom, Esztergom), but by that time they had not been institutionalised. The new bridge Maria-Valeria provides further opportunities for enhancing the cooperation. Nowadays a not too beneficial component of borderline relationships is „petrol tourism”, that is, car owners crossing the border for cheap fuel. Eastern Slovakian border region: Following the crises of the former mass production industries the region suffered from permanent employment tensions and problems. The process of the economic restructuring is slow, the resources for agricultural production are unfavourable and the service sector is underdeveloped, the population is affected by unfavourable demographic trends (ageing, out-migration, the high proportion of uneducated, and unemployed Roma (Gypsy) population living on state grants and unemployment benefits). This tendency is a common problem for several 120
eastern European countries, (including Poland and Romania besides Hungary, and the resolution may be found by a macroregional approach, although these countries cannot become generators of modernisation by themselves). There are examples in the region of institutionalised crossborder cooperation in the territory of the Danube-Ipoly nature conservation area, where in 1999 the Ipoly Euroregion was established, which tries to resolve the common problems by developing microregional and settlement-level cooperation. The Ukrainian border region This region is in a similar situation as the eastern Slovakian border region, as well as the Romanian border region. There would be need to open new border crossing stations, or increasing the capacities of the existing ones here, but the differing competences and public administration levels of the neighbouring countries make it difficult for the centres to provide sufficient resources and attention to the border region. The cross-border movement of the population is rather dynamic, mainly due to the shopping tourism, but this border region is heavily affected by illegal activities (smuggling of cars and persons, petrol tourism, organised crime). Three international road crossings and one rail crossing exist in the region and besides these two temporary road crossings are available for the inhabitants of the border region. Romanian border region: The characteristics of the former two regions are also characteristic for this region, that is, the peripheral situation, but a few large centres by the opposite sides of the border show more intensive business activities. The rather large numbers of Hungarian minorities over the border make the Romanian side more active in searching for cooperation possibilities, and it leads to very colourful economic relationships and cooperation of settlements over the border. In the southern and the south-eastern border regions there are several large centres wich may be competitors to each other in the future (Szeged – Timisoara, Békéscsaba – Arad), while economic cooperation is slow to develop. One of the main initiators of the cooperation could be the Danube-Körös-Maros-Tisza Regional Cooperation, but the consequences of the was in Kosovo hindered the development of these relations. Although the willingness of the settlements and the regions is there, the hindering conditions are the insufficient numbers and capacities of the border crossing stations. Altogether 13 road crossings serve the 450 km long border section, of which only 8 are open as permanent international crossing points. This means an average 56 km distance between two permanent road crossing points, which is far from enough. There are 5 rail crossings, which number is also insufficient regarding the volume of the traffic (Baranyi, 2004). Serbian border region: This region, situated at the edge of the Great Plains, is gradually becoming more and more dynamic. Szeged, as a major centre and Baja as a secondary centre, a medium size town have the largest impacts on the development of 121
the region, but besides these there are several rapidly developing smaller towns in the area. The relationships are strongest currently in the private travels of the inhabitants, but the „grey economy” of the region is also remarkable, which means business activities. After the stabilisation of Serbia, and in particular, Vojvodina the chances are good for the rapid development of the cross-border cooperation, which will lead to the „whitening” of the currently „grey” economic connections. Among the eastern border regions this is the area where the accessibility is best, the transportation network is satisfactory. The Croatian border region: Here two peripheries, namely southern Transdanubia in Hungary, and another periphery without centre in the Croatian side meet at the border, and the connections of the two areas are hindered by the fact that the georgraphical border, namely the river Drava has very few bridges and it is often necessary to make large distances of round trips to reach certain destinations. The private connections by some specific areas of the border have become very lively (shopping tourism in the directions of Zalaegerszeg, Nagykanizsa, Barcs, Csurgó), but the institutional initiatives have not been met with interest in the opposite side of the border. Remarkable development ideas were formed on the state level to develop transport infrastuctures (Rijeka-Zágráb-Budapest), but the number and location of border crossing stations is currently the most serious barrier before the further development of these connections.
Figure 3.2: Borderline microregions in Hungary. Source: Országos Területfejlesztési Koncepció, 2005, VÁTI Kht., Budapest (VÁTI, 2006a) 122
In the next chapter the Croatian and Hungarian borderline will be extensively described, with recommendations and declarations about future opportunites. Generally speaking it may be stated that the ecomonic actors of modernising capacities choose their location to be easily accessible by road or rail, from the centre of the large towns or cities of Austria and Bavarian towns and cities (e.g. privatisation possibilities). This has definitely determined the chances of borderline territories in competition with less problematic areas being less peripheral, and the roles they could play in the newly created spatial development system.
3.2 Cross-border cooperation programmes in Hungary in the last ten years 3.2.1 Cross-border programmes between 1995 and 2003 The European Union has put increasing emphasis on cross-border developments since the beginning of the 1990-ies, both for its internal and its external borders, as well as for the boundaries of the accession countries. As the first measure to encourage cross-border cooperation and a preparation for the INTERREG IIIA programmes the Phare Cross-border Cooperation (Phare CBC) programme was introduced to Hungary. Phare CBC was targeted at the development of cross-border cooperation and to enhance development in these formerly peripheral and underdeveloped regions by assisting in making the borders easily penetrable (VÁTI, 2006a). In Hungary the first cross-border cooperation activities started in 1995 at the Hungarian-Austrian border followed by projects at the Romanian, Slovenian, Slovakian borderlines and up to now altogether 135 million EUR support was spent from PHARE sources. In 1999-2000 the project CREDO was implemented within the framework of PHARE, covering several countries including Hungary, Slovakia and Ukraine. In 2003 a new HungarianUkrainian fund was established for supporting small pilot projects. In Slovakia between 1995 and 2002 altogether 57.25 million EUR was spent for developments within the PHARE CBC programme. The resources were mainly utilised for environmental (46 %), traffic and transport (21 %) investments. Since 1996 Ukraine has also been participating in the TACIS Cross-Border Cooperation programme. TACIS funds are made available for the countries of the former Soviet Union, e.g. Russia, Ukraine, Belarussia, and Moldova. Between 1996 and 2003 Ukraine received development funds from the EU for improving the infrastructural and environmental conditions in the borderline regions.
123
From 2004 to 2006 the enlargement of the European Union changed the PHARE cross-border cooperation between Hungary, Slovakia and Ukraine for the INTERREG IIIA Hungary-Slovakia-Ukraine Neighbourhood Programme. The INTERREG Community Initiative was established in 1990. Its main objective is to strengthen the economic and social cohesion by supporting transboundary cooperation both between EU-member states and non-EU countries. The INTERREG III Community Initiative is aimed at helping the people living in the borderlands to develop and implement joint projects, in order to increase the institutional and economic capacities and the economic potentials of the border regions, enhancing the cooperation between the two sides of the border. There are three basic forms of INTERREG III programmes: cross-border cooperation (INTERREG IIIA), transnational cooperation (INTERREG IIIB) and interregional cooperation (INTERREG IIIC). For the programming period of 2007-2013 the present INTERREG Community Initiative becomes an independent objective called „European Territorial Cooperation”. The main direction of cooperation remains the development of small and medium size enterprises, tourism, cross-border commerce, culture, joint environmental actions, access to transboundary transport and information networks, transboundary water and waste treatment actions, joint health care, cultural and educational structures (VÁTI, 2006a).
3.2.2 Neighbourhood programmes in 2004-2006 Within the framework of the neighbourhood programmes the partners could submit proposals for joint projects, mirror projects and complementary projects. The applicants eligible for support were non-profit organisations, and small and medium size enterprises which intended to cooperate with a similar partner across the border, and whose headquarters or at least one of their affiliates were located in the border region.
3.2.2.1 The Hungary-Slovakia-Ukraine Neighbourhood Programme 2004-2006 The objectives of the Hungary-Slovakia-Ukraine Neighbourhood Programme (2004-2006) were the development of the cross-border economic cooperation, the improvement of the borderline infrastructural conditions, and thus the improvement of the general situation of the region and eliminate its peripheral characteristics. The territory of the borderline: In Hungary: the counties of Gyõr–Moson–Sopron, Komárom–Esztergom, Pest, Nógrád, Heves, Borsod–Abaúj–Zemplén, Szabolcs–Szatmár–Bereg and Budapest capital; 124
In Slovakia: the counties of Bratislava (Bratislavský kraj), Trnava (Trnavský kraj), Nitra (Nitriansky kraj), Banska Bistrica (Banskobystrický kraj), Kosice (Košický kraj) and Presov (Prešovský kraj); In Ukraine: county Kárpátalja (Zakarpatia oblast). Action Priorities The strategic objective of the programme was to strengthen the level of economic and social integration of the cross-border region, to develop the sector of business services, to support the small and medium size enterprises, establish cooperation in the areas of infrastructural development, environmental protection and nature conservation, as well as to provide assistance for public health improvements, fight against crime and improve small-scale transport infrastructure. The funding provided for the neighbourhood programme for the EU member states, Hungary and Slovakia was provided by ERDF while Ukraine received partial financing from TACIS for the 2004-2006 period. In 2004-2006 the total funding available for the programme, together with national cofinancing was 19.1 million EUR for Hungary, 12.6 million EUR for Slovakia and 4.5 million EUR for Ukraine.
3.2.2.2 Austria – Hungary Programme
INTERREG IIIA Community Initiative
The programme revolves around six development priorities. The overall objective of this programme – financed under the community initiative INTERREG – is economic, social and rural development of the AustroHungarian border region. Priorities of the programme: • • • • •
Cross-border economic co-operation Improvement of the infrastructure and accessibility Cross-border organisational structures and networks Human resources Sustainable cross-border environmental and spatial development
The eligible area covers the Austrian Federal Länder of Burgenland and Vienna, the region to the South of Vienna, the South of Lower Austria and, on the Hungarian side, the counties of Györ-Moson-Sopron, Vas and Zala. The European Union provided co-financing for the eligible areas on either side of the Austro-Hungarian border by the INTERREG III A programme for the 2000-2006 period. The total cost of the programme is 77 million euros, of which the European Regional Development Fund (ERDF) will contribute 41.5 million euros.
125
Figure 3.3: The Austria-Hungary border region. Source: Váti, 2006a.
3.2.2.3 Neighbourhood Programme Slovenia – Hungary – Croatia The joint strategy of the programme was aimed at promoting the development of the trilateral border area into a common, future-oriented economic and living area, to improve its competitiveness within the European context, to enhance sustainable living conditions of the residents in the area and to help to overcome regional development disadvantages caused by separation through national borders. The programme had two priorities (in addition to technical assistance): • Economic-Social Cohesion and Human Resources Development. Development of a joint economic area, development of human resources by the border, and the establishment of a joint touristic and cultural space by the border. • Sustainable Development: sustainable utilisation of natural resources, the protection of the environment, nature conservation and the improvement of accessibility. The area of cooperation: 126
-
Slovenia: statistical regions of Pomurje, Podravje, Savinjska, Spodnjeposavska, Jugovzhodna Slovenija, Notranjsko-kraka, Obalnokraka; Hungary: Vas, Zala, Baranya and Somogy counties; Croatia: Osijecko-baranjska, Viroviticko-podravska, Koprivnickokrizevacka, Medimurska, Varazdinska, Krapinsko-zagorska, Zagrebacka (except for Zagreb, the capital), Karlovacka, Primorsko-goranska, Istarska counties.
Notation: Croatian and Slovenian counties: Osijecko-baranjska (1), Virovitickopodravska (2), Koprivnicko-krizevacka (3), Medimurska (4), Varazdinska (5), Krapinskozagorska (6), Zagrebacka (7), Karlovacka (8), Primorsko-goranska (9), Istarska (10), Pomurje (11), Podravje (12), Savinjska (13), Spodnjeposavska (14), Jugovzhodna Slovenija (15), Notranjsko-kraka (16), Obalno-kraka (17).
Figure 3.4: The Slovenia-Hungary-Croatia border region Source: Váti, 2006a. The programme was financed by the ERDF of the Structural Funds for Slovenia and for Hungary, and the assistance amounts to EUR 23.80 million out of a total budget of EUR 31.73 million. For Hungary the total amount was 3.26 billion HUF. For Croatia the financial resource was provided by CARDS.
3.2.2.4 Hungary - Romania and Hungary - Serbia & Montenegro Cross-Border Cooperation Programme The overall aim of the programme Hungary-Romania and Hungary-Serbia & Montenegro was to bring the people, communities and economic actors of the border area closer together in order to establish a sound basis for 127
balanced economic and social development, assuring optimal development opportunities for all three countries. The programme has two priorities (in addition to technical assistance): • Strengthening the spatial, physical and infrastructural integrity of the cross-border area: including the improvement of the borderline infrastructure, environmental protection, facing the challenges of river floods, and development of the border crossing and transport infrastructure by the borders. • Promotion of cooperation initiatives in order to facilitate the integration of markets and enhance coherence between local societies: including business infrastructure, joint development of business services, promote cooperation of small and medium size enterprises, cooperation between communities and institutions across the border, cooperation in research and development and in human resources development. The following territories were entitled to participate in the programme: • • •
Hungary: Szabolcs-Szatmár-Bereg, Hajdú-Bihar, Békés, Csongrád and Bács-Kiskun counties Romania: Satu Mare, Bihor, Arad and Timis counties Serbia and Montenegro: West-Bácska, North-Bácska, North-Bánát, South-Bácska, Central-Bánát, Szerémség, South-Bánát and Beograd.
The Hungarian areas received funding from the INTERREG IIIA resource, ERDF, Romania from Phare CBC, while Serbia and Montenegro from the CARDS Neighbourhood Programme. The EU co-financing assistance amounted to EUR 39 million out of a total budget of EUR 47 million.
3.2.2.5 Community Initiative INTERREG IIIB CADSES programme Out of the three strands (A,B,C) of the Community Initiative Interreg III, CADSES (Central, Adriatic, Danubian and South-Eastern European Space) belongs to the B strand, addressing trans-european cooperation on a transnational level, whereas the cornerstone of strands A and C are crossborder cooperation and transregional cooperation respectively. CADSES aims at achieving higher territorial and economic integration within the cooperation area, promoting more balanced and harmonious development of the European space. The CADSES Programme is, among the 13 transnational co-operation areas in Europe, the largest and most complex area. From the coasts of the Baltic Sea, through the mountains of the Central Europe and the Hungarian plains, through the Austrian and Slovenian Alpine landscapes, CADSES stretches down to western Italy and Greece, thus grouping the Balkan regions, including Moldova and part of Ukraine. The CADSES area comprises regions belonging to 18 countries: 9 of them are EU-Member States (Austria, Czech Republic, Germany, Greece, Hungary, Italy, Poland, Slovak Republic and Slovenia) and 9 are Non-EUMember states (Albania, Bosnia and Herzegovina, Bulgaria, Croatia, 128
Federation of Serbia and Montenegro, Former Yugoslav Republic of Macedonia, Republic of Moldova, Romania and Ukraine).
Figure 3.5: The CADSES area Source: www.cadses.net, 2006. The action priorities cover a wide range of actions - Promoting spatial development approaches and actions for social and economic cohesion: with the aim of supporting joint strategies and actions for implementation, shaping urban development, promoting urban networks and co-operation, shaping rural development, assessing the spatial impact of immigration. - Development of efficient and sustainable transport systems and improvement of the access to the information society. - Promotion and management of landscape, natural and cultural heritage. - Environment protection, resource management and risk prevention, water management and prevention of floods. The programme applies the principle of the „leading partner” that is, the project participants select a partner for coordinating the activities and for taking the responsibility for the achievement of the project objectives. This partner had to be an EU-member, and was responsible for managing the financial issues during the implementation of the project.
129
The history of the CADSES programme The CADSES area has been established within the INTERREG IIC programme during 1997-2000. Interreg IIC had similar objectives and principles to that of the current CADSES. In the framework of INTERREG IIC CADSES altogether 45 projects were implemented with the participation of 330 organisations. The projects were focused mainly on scientific cooperation, with the direct results in the form of studies, books, publications, conferences and seminars. One of the major results of INTERREG IIC was the establishment of a network which assists in the knowledge transmission in the field of territorial development. The success of the programme can be seen in the process of exchanging ideas about the CADSES macroregion and its spatial development plans. The studies, reports, analyses are high quality research results based on wide consensus of the participants. The VISION PLANET project may be specifically mentioned as an outstanding example of cooperation having the largest numbers of partners and a lobbying capacity reaching the authorities in Brussels. The results of this project became incorporated into university education in Hungary. At the time Hungary was the only non-EU member state that became fully integrated into the programme, both in its management and in its project activites. Hungary has often been involved in projects with German and Austrian partnerships, as well as with Slovenia, Slovakia and Romania.
3.2.2.6 The INTERREG IIIC Programme The INTERREG IIIC programme was one of the three strands of the European Community Initiative INTERREG III. With INTERREG IIIC, interregional co-operation between regional and other public authorities across the entire EU territory and neighbouring countries were promoted. It allowed regions without joint borders to work together in common projects and develop networks of co-operation. The co-operations under INTERREG IIIC gave access to experience of other actors involved in regional development policy and created synergies between "best practice" projects and the Structural Fund’s mainstream programmes. The overall aim was to improve the effectiveness of regional development policies and instruments through large-scale information exchange and sharing of experience (networks) in a structured way. The INTERREG IIIC programme was financed by the European Regional Development Fund (ERDF), as part of the Structural Funds, and co-financed by national project partners. The application period was 2002-2006. All activities had to be finalised by end of 2008. INTERREG IIIC supported a variety of topics closely related to implementation of EU regional policy. Exchange of experience and networking focused on: Objective 1 and 2 This category of operations was directed at promoting co-operation of projects focussing on themes related to Structural Funds Objective 1 and 2. 130
INTERREG programmes This type of operations was aimed at promoting exchange of experience and networking among areas involved in current or previous INTERREG programmes. INTERREG IIIC operations took experience collected in the past as starting point to further develop project and policy approaches. Actions were also focused on the implementation of INTERREG programmes. Urban development In addition to actions supported under the URBAN Initiative and the mainstream objective programmes, this category of operations focused on wider co-operation actions related to urban development issues. This topic was open to all cities and urban areas, including small and medium-sized towns. Innovative Actions • This topic focused on promoting co-operation between regions involved in one or several of the three themes of the regional Innovative Actions for 2000-2006. Operations under this topic were to encourage the transfer and implementation of successful project ideas from one region to other ones. The three priorities of the innovative actions for 2000-2006 were the knowledge-based regional economies and technological innovation; e-EuropeRegio: the information society and regional development; regional identity and sustainable development. Other appropriate subjects • Research, development, small and medium-size enterprises, information society, tourism, culture, environment, employment.
3.2.3
New programmes within the framework of the European Territorial Cooperation Objective, 20072013
Hungary is expected to receive an approximate 300 million EUR support for the 7 years, from the budget of the European Territorial Cooperation objective, for 7 cross-border programmes. In the implementation of these programmes the principle of the „leading partner” must be applied, that is, at least two partners from two countries must take part in the projects and at least two of the following criteria must hold for them: • • • •
joint joint joint joint
planning implementation staff or institutional background for the project financing
The partners decide together about the selection of the leading partner, and then this partner submits the project proposal in the name of the whole group. In the case of successful proposals the leading partner becomes the contracting party, and becomes responsible for the practical and financial management of the project, and for preparing the interim and final reports 131
for the project, acting as a contact party for the contract, and for the monitoring authorities and bodies. Similar to the former programming period, three project types may be proposed in the new period of 2007-2013, too. Joint project The participants of the project design and implement the project together. The leading partner submits the joint project proposal, in the name of all the partners involved. The partners complete the same set of documentation, and the specific roles and tasks allocated to each partner are defined and specified in the attachments. The beneficiaries will be contracted separately, that is, one party from each country involved. Mirror project Two or three separate proposals are submitted to the programme authorities. The projects implemented at the opposite sides of the border will have to complement each other. In all of the project proposals clear references have to be made to the mirror project proposals submitted by the partners. The project proposals are handled separately in the monitoring system, separate contracts are signed with the participants. The implementation of these mirror projects does not have to be run in a parallel way. Individual, separate project The project proposal is designed in close cooperation with the partner across the border, but only one project proposal is submitted for support, and will receive support from one resource. In this project type the cross-border impacts have to be very carefully demonstrated. The implementation of the project takes place only at one side of the border. The cross-border programmes in which Hungary is expected to participate in the period 2007-2013 are the following: • Hungary – Austria cross-border programme – the approximate funding expected for the 7 year period is 75-80 million EUR • Slovenia – Hungary cross-border programme – approximately 25-26 million EUR • Hungary – Croatia cross-border programme – approximately 60-80 million EUR • Hungary – Slovakia cross-border programme – approximately 175 million EUR • Hungary – Slovakia-Ukraine-Romania cross-border programme – approximately 60-70 million EUR • Hungary – Romania cross-border programme – approximately 200 million EUR • Hungary – Serbia cross-border programme – approximately 40-60 million EUR
132
3.3
Problems, achievements and further opportunities of cross-border cooperation by the Hungarian borderlines
3.3.1 The cross-border relationships and achievements of Hungarian regions, future opportunities 3.3.1.1 North-East Alföld (Great Plain) borderline The Northern Great Plain (Észak-Alföld), which embraces three counties (Jász-Nagykun-Szolnok, Hajdú-Bihar and Szabolcs-Szatmár-Bereg), is bordered by Romania and the Ukraine from the east, by the River Tisza from the north and by Hungarian counties from the south. The monotony of its plains is disrupted by saliferous and fresh-water lakes, dead channels surrounded by reeds, acacia trees and the blue ribbons of rivers flowing into the Tisza. Its territory covers nearly half of the Hungarian Great Plain, with an area of 17 729 square kilometres. In terms of Gross Domestic Product per capita, the region registered EUR 3 771 in 2001. This is relatively low compared to the rest of the country, and only Northern Hungary registered a lower value. Although between 1995 and 2001, the growth rate of the Gross Domestic Product of the region was under that of the country, it must be noticed that between 2000 and 2001, the rise was higher in the region (20.0 %) compared to the national average (14.7 %). In 2001, the region accounted for 10.2 % of the Gross Value Added of the country, a share which is constant over the years. The share of the primary sector in the Gross Value Added was 8.6 % - twice as high as the national average. Regarding the secondary sector, its share in the GVA was comparable in the region (31.6 %) and at the national level (31.3 %). The share of the tertiary sector was consequently lower in the region (59.8 % against 64.4 % nationally). The region is twice as rich in tourist attractions as the national average. The medicinal waters of Hajdúszoboszló are famous internationally, and many people visit the spas of Nyíregyháza-Sóstó, Debrecen as well as Szolnok. Tourists can have a relaxing rest in the thermal baths or get cured from the world famous health spas with their curative waters. The region has a special natural treasure: thermal and curative waters replete with special types of minerals. The Hortobágy National Park became a World Heritage Site in the heart of Europe and is unique in its preservation of its treasures. The area of the National Park is of 81 000 hectares. Whoever looks at this area as just the "Puszta" would be wrong: a good part of the area is salty meadows but there is a huge lakes system here as well. More than 40 % of this area is boggy, marshy and swampy (KSH, 2006). The north-eastern borderline area of the Great Plain has been traditionally an underdeveloped region. This backwardness seen in the level of economic and social development has grown since the transition of 1989. The demographic trends of the area show slight increase in the population, but 133
this goes hand in hand with the restructuring of the ethnic map of the area (Baranyi et al., 1999; Baranyi, 2004). The majority of the borderline areas has still been underdeveloped in northeastern Hungary. There are no sustainable economic programmes, and the infrastructural conditions are very bad, the transportation facilities have not been improved and the enterprises try to avoid the region. It is crucial for Hungary to keep its borders open, because of the geographical location of the country and of the need to maintain the strong attachment to the Hungarian minorities over the border. The border region of North-East Alföld Any development idea for the north-eastern borderline of the Great Plain must consider as first priority to initiate developments that prepare it to fulfill the role of an international bridge between East and West. It is obvious that the own resources of the area are insufficient to the achievement of these objectives and the grave economic and social problems cannot be solved without the assistance of the external (national government and the EU) development resources, although the maximum mobilisation of the internal resources is absolutely necessary, too. As the region is rather heterogeneous in character, the development must focus on different objectives, but one component is common for the whole area: crisis management and dynamisation of the economy of the region must go together. The development of borderline areas requires qualitative changes in the economy of the region, because to achieve an average level of development the above average growth rate is absolute necessity. This points out the specific resource of the region, namely the possible advantages of the borderline location by developing the connections over the border and utilising these for the development of the economy, relying on the international transit capacities of the region. Besides, attention should be paid to the remote areas, where rural development programmes have to be implemented. Besides, the improvement of the quality of life should be achieved while maintaining the environmental potentials of the region, conserving the unique natural environment which has already disappeared from the more advanced regions of Europe. Considering the above the following development priorities may be defined for the area: • Increase the competitiveness of the economy. • Enhance the capacities for the role of an East-West transit area (bridge), develop the gateway function or the region (Záhony, Berettyóújfalu-Biharkeresztes). • Develop the existing knowledge base towards the needs of the market economy. • Job creation by investments. • Implement environmentally conscious rural development programmes. 134
•
Provide the conditions of quality living standards for the inhabitants of the region.
From the viewpoint of the whole borderline area of the north-eastern Great Plain region the enhancement of the capacities for the bridge role of the eastwest transit area is of particular importance, because it refers to the specific advantages generated by the borderline location. To achieve this objective the following target activities must be kept in mind: • To develop the national and international transportation network and infrastructure to improve the internal and external accessibility of the region. • To develop the business infrastructure needed for the international (transit) trade. • To develop the educational background of the international economic connections, establish international cooperation in training and education. • To enhance cross-border economic cooperation. • To develop and encourage interregional cooperation and organisations for cooperation. • To prepare the area for the opportunities created by the accession of Hungary to the EU. • Maintenance and development of the Regional Ecological Network. The transboundary cooperation has great importance for a region having long external borderlines between two countries. The connecting role of the borderline area is important not only for the economy and transit traffic but also from cultural, civilian and interethnic respects, too, although the areas directly over the border are mainly populated by the Hungarian minorities, the daily connections are also essential with them, as the EU actually handles cross-border cooperation as a main priority entitled for considerable financial support, although at the moment the present connections are mainly cultural, sports and twinning events (Baranyi, 2004). After the accession to the EU, Hungary, and especially north-eastern Hungary has had a bridge role towards the neighbouring countries in the transmission of information, capital flows and cultural relations as well. This intermediary role means not only responsibilities but also considerable economic opportunities that have to be utilised. For this the region needs to develop internally, including the development of transportation and other economic infrastructures and also the improvement of internal and external accessibility. In order to utilise the opportunities provided by the economic and transit role the development of the techniques of networking and international cooperation would also be necessary, mainly within the framework of the Carpathian Euroregion, which is a rather formal organisation nowadays. Finally another important task for the short and medium term is to make the working organisations gain skills and experience in managing crossborder cooperations, in order to be capable of efficiently utilising the financial resources available in the framework of the relevant EU programmes.
135
From assessing the situation in the borderline the internal strengths, weaknesses of the borderline microregions and the potential opportunities and threats arising from the operations of external factors (e.g. macroeconomic trends, international relations, national measures and regulations) may be identified, giving the background for the development processes of the region. Strengths • Borderline location, favourable geopolitical situation, existing border crossing stations, the East-West international bridge role of the area. • The Záhony Entrepreneurial Zone and its considerable reloading capacities, the strengthening regional roles of Debrecen and Nyíregyháza, the Bihar Business Zone and Industrial Park. • The favourable landscape, natural resources, touristic endowments (ecotourism), the clean environment, varied agricultural resources, local unique or specific agricultural products, rich natural and ecological endowments. • The wider region owns large traditional energy resources, crossed by major channels of energy transportation. • Rich folklore, historical traditions, heritage and sights, low cost, cheap labour in large numbers, balanced demographic trends, lively or enlivened Hungarian to Hungarian interethnic ties. Weaknesses • Poor soil quality, danger of floods and of draughts. • Unfavourable composition of the population. • Fragmentation of the settlement structure, weak integration of the counties, the periphery of peripheries, extensive external and internal peripheralities. • Underdeveloped infrastructure of the settlements, lack of modern transport infrastructure, bad quality of existing connections. • Insufficient entrepreneurial capital for starting enterprises, low level of attention from western investors, the diffusion of innovation is stopped at the centres, no entrepreneurial attitude and mentality. Opportunities • Small towns develop their attraction zones in their vicinity. • Penetrable, open borders, dynamic development of eastern markets, processing of raw materials coming from the east, development of the bridge role, establishment of logistic centres, extension and modernisation of border crossing stations, opening of new ones. • Growing interest of investors for North-Eastern Hungary as investment area, strengthening economic and social cooperation with Romania, Ukraine, the strengthening of business enterprise zones (Záhony, Berettyóújfalu-Biharkeresztes), international transit trade, increasing volumes of spedition and transport. • Positive impacts of EU accession (EU development funds), Structural funds for spatial and economic development, careful and considerate central development programmes, the Carpathian Euroregion. • Increasing demands of home and international tourism. 136
•
Growing demand for specific and unique local agricultural products (hungaricums), rich natural endowments, historical, folklore, and interethnic traditions.
Threats • The conservation of the separating roles of the borders, rigidity of international relations, the conservation of the underdeveloped infrastructural facilities, the decline of the areas unable to connect to the traffic corridors, the logistic centres of the southern and eastern traffic corridors in the neighbouring countries. • The out-migration of the population continues, low level of education, degradation of human resources, deepening problems of employment, deepening social crisis, increasing levels of unemployment. • Strong degradation of the natural environment. • Further decline, multiply disadvantaged character, deepening peripherality. • Loss of competitiveness due to unsuitable definition of the NUTS II region, and the consequences of the EU membership, loosing EU resources, insufficiently coordinated and inefficient utilisation of the development funds coming to the region from the EU and from national resources. • The economic and social crisis becomes permanent in the CIS countries. For the settlements of the borderline area the most important objective is to develop the networking and local infrastructural conditions. This would in itself initiate considerable economic development, and increased employment. Mainly the infrastructural developments are the most necessary in the borderline areas, together with the developments encouraging the entrepreneurial activity and leading to the establishment of new businesses. Under the present economic circumstances priority should be given to the connections of the market lines within the region and the building of external economic connections outside the region. The gravest problem in the area is the so far unresolved employment crisis, especially the high level of long term unemployment. The area is traditionally an agricultural area and the restructuring of land ownership and farming the borderline settlements lost their major employer activity. Thus the solution of the situation lies at least partly in the development of agriculture. Thus the local agricultural sector has to cooperate with the local municipality and besides economic interests social aspects will have to be seriously considered. The solution cannot be found without joining to the complex national and regional development programmes by regional and microregional projects, utilising the funding available within the framework of these programmes. Municipalities have to consider that agriculture may be the solution for finding employment for the undereducated, immobile labour force, including the large Gypsy population. A possible form of regional or microregional cooperation of municipalities is the establishment of agencies for economic development in the microregional centres, whose main role would be the organisation of the markets (internal 137
and external as well), organisation of the cooperation of actors (e.g. farmers and production and marketing cooperatives, vertical and horizontal cooperation of producers of similar products or product chains, contractors to larger firms, etc.) management of project proposals (actual direct help in preparing proposals, finding suitable programmes for particular project ideas, etc.), the improvement of connections between municipalities and local entrepreneurs, and to carry out active spatial marketing activities, and last but not least, the development of complex transboundary cooperation between settlements and actors at the opposite sides of the border. Hungary has extensive rural areas with the dominance of agriculture, where the resolution for the grave employment problems may be the development of agriculture with its low demands for capital investment. This is true for the north–eastern Great Plain area and its borderline regions as well. However, agriculture in itself cannot become the dynamic driving force of the development of a region, its role is restricted to provide market for the local labour supply, and raw material for the procession industry and food for the population. It also carries a proportion of the social burdens and the environmental tasks of the region. But the dynamic progress of the region cannot be imagined without a considerable renewal of the industrial and the tertiary sectors as these are the sectors the growth of which will have a multiplying effect on other parts of the economy, thus making them the driving forces of economic and social progress of a region.
3.3.1.2. Northern Hungary Situated in the north east of Hungary, Northern Hungary has common borders with Central Hungary in the west and Northern Great Plain in the south. To the north is the international border with the Slovak Republic. The region covers an area of 13429 square kilometres and had a population density of 96 inhabitants per square kilometre in 2003. The region had 1289 thousand inhabitants on 1st January 2003. The main towns are Miskolc, Eger, Salgótarján, Ózd, Kazincbarcika, Gyöngyös, Hatvan, Balassagyarmat, Tiszaújváros, Mezıkövesd and Sátoraljaújhely. In 2001, Northern Hungary accounted for 8.4 % of the Gross Value Added (GVA) of the country. Its GVA has increased by 54 % between 1995 and 2001, this is, however, lower compared to the growth of the national average. The primary sector accounted for 4.6 % of the region's GVA in 2001, while the share of the secondary sector was the third most important in Hungary, with 39.5 % - more than 8 percentage points higher compared to the share observed nationally. The tertiary sector had a relatively lower share in the GVA (55.9 %) compared to Hungary as a whole (64.4 %). The leading branches are chemical industry, electricity, food industry, engineering industry, metal processing and metallurgy, and in the case of export the share of the chemical industry, engineering industry, textile industry, leather and fur production was the highest. Mining in its own sector is really significant at national level, though its importance within the region is continuously decreasing. It is the least developed region of Hungary, having the lowest per capita GDP throughout the country. The number of business enterprises per 1000 138
inhabitants is the lowest in this region, the employment rates are low, unemployment rates are outstandingly high. The economy of Northern Hungary is characterised by the dominance of small and medium-size enterprises. The centres of higher education plays an important role in the research and technological development of the region. Many innovation intensive small and medium-size enterprise appeared during the least years connected to the universities. High- and medium-tech foreign companies and large local firms base their research and development onto the academic background of the universities. However, the propotion of the population having no qualifications at all is higher than average, there is a strong outmigration tendency for the educated young population. The Slovakian-Hungarian border region This area is located at the Western border of the Carpathian Euroregion. The neighbouring countries in the region are mainly former socialist countries, which had established a somewhat forced and formal transnational cooperation among them. These ties have been broken at the fall of the Soviet Empire, and then the infavourable political atmosphere in Slovakia in the mid-90ies. Following the 1998 elections the conditions for economic and educational cooperation were re-established. Such cooperations, however, are to be set up not by state-level administrative decisions but on regional and local level by the initiatives of the local actors. In the long term, due to its historical traditions, a similar area could be formed here as the Beneluxstates in West (Radácsi, 2005).
Figure 3.6: The Hungary-Slovakia border region Source: www.vati.hu
139
The longest section of the Slovakian borderline is the border with Hungary, altogether 670 km, with 17 border crossings, that is, an average distance of 39.1 km between crossings. This average distance is not worse than the average, but the specific history of the border should guarantee a more dense network of crossings. Before the 20th century no border existed here, the population maintained everyday connections, and many roads, footpaths and tracks led through the present border. After the enlargement of the EU in 2004, this border has become an internal border of the EU, and Hungary initiated discussions about opening new crossing points at the border. This is even more important, as the distances between villages by the border are very short and reconstruction of the unused roads and paths could establish about 84 possible crossings at the border (Mezei, 2005). In the borderline region the main problems are basically the same at the opposite sides of the border, and their resolutions are also nearly the same. The area itself is a rather specific area according to EU-standards, or even according to Central and Eastern European standards, where two underdeveloped areas facing crisis are connected (Bajnai-Gutai, 2004). The most severe problems of the area are the following: - decreasing population with considerable out-migration, - very high unemployment, - high proportion of inactive population, low activity rate, - high proportion of employment in industry and construction, - agriculture cannot employ the large numbers of unemployed population, - the mining industry has declined, the number of jobs in industry has drastically decreased, - very high level of poverty and deprivation, low level of education and high proportion of Gypsy population in the region, - the attractions of nature conservation and protected environment, cultural heritage are unused, - tourism practically avoids the region. This process would lead to severe problems in any EU member state, but it is even more dangerous in this cross-border region, for the following two reasons (Bajnai-Gutai, 2004): • If at both sides of the border a contiguous large zone can be formed with severe poverty and social and economic problems, then this region - will be unable to develop relying on its own resources, - cannot accept the business actors, - will not become attractive for investors, but just the opposite, and then this region will be unable to function as a connecting zone, a gateway region between the neighbouring countries, but just the opposite, becomes a separation zone isolating the neighbouring countries. • This problem is particularly severe in this cross-border region, because there would be an opportunity to develop tourism relying on the attractions of the common European architectural heritage, and 140
the crisis-stricken socio-economic environment makes the utilisation of this opportunity impossible. The educational level of the villages and towns at the Slovakian side of the border are higher than that of the borderline settlements in Hungary. Considering, that in Slovakia the population of the settlements assessed are mainly of the Hungarian minorities, and the average level of schooling is higher for a Slovak citizen than for a Hungarian one, then the educational level of Slovakia is really considerably higher than that of Hungary. This is even more obvious for vocational education and secondary education, while the proportion of those having tertiary (university) qualification are similar in both countries, or is slightly higher in Hungary. The age structure is somewhat younger in Slovakia. The proportion of industrial employment is higher in Hungary, while agricultural employment is higher in Slovakia, especially in the Rimska-Sobota district, where the proportion of the Hungarian population is the highest. The former industrial activity of northern Hungary has lost its significance, and face crisis. The emergence of modern industry is hardly notable. The negative impacts of the former one-sided industrial structure are still felt. The solution for industrial development and thus job creation for the longterm unemployed would be the restructuring economy and a varied industrial structure based on the medium-size enterprises (Radácsi, 2005). The importance of cross-border relationships is even more obvious, as there is hardly any chance for the renewal of the historical macroregional cooperation of the Carpathian Basin, and instead of this the cross-border linkages may be the level of successful interregional connections in the future (Mezei, 2005). The possible directions of development are the same at both sides of the border, because the state borders, as internal borders of the EU, will become insignificant due to the four freedoms of the EU, and the economic progress at one side will unavoidably influence the development of the other side. The main directions of economic development would possibly be the industry and tourism (Bajnai-Gutai, 2004). The importance of industry is explained by the fact that the very high numbers of unemployed population cannot be absorbed by any other sector but manufacturing and construction, because the educational level of the majority of the unemployed is very low, and the level of transport infrastructure and energy supply are also suitable for this. Tourism would be a possible growth area because of the very rich natural and cultural heritage which is definitely an advantage in the cross-border region. The locations and centres for the development of industry and tourism should be the towns of the area because the potential labour force is concentrated in the vicinity of the towns, the necessary transport and services infrastructure is available in and around the towns, as well as the research and development capacities, and especially in the neighbourhoods of Miskolc and Kosice. Here the infrastructure required for a successful tourism industry are best available, and here the cultural and nature tourism can meet and enhance each other’s success. 141
Successful CBC projects show that the local actors also consider industry and tourism as the most important development directions for the region, for which the rehabilitation and development of town centres within the region are necessary first steps (Bajnai-Gutai, 2004). The number of twinning connections has considerably increased after 1990, but these individual ties cannot be efficient initiators of development except if the twin settlements are located in each other’s immediate neighbourhood. There are many such settlements by the border, 56 such towns and 871 villages at the Hungarian side have established 346 twinning connections up to now. There is a marked increase of such relationships from the east to the west. The only exception is the towns of county Heves. The Slovakian side is characterised by a very high number of settlements, due to the fragmentation of the settlement structure. Besides, the southern counties are too large compared to the size of the country as a whole. The reason for this is partly political: this was the method the Slovakian authorities used to joint the areas dominated by Hungarian ethnic population to those northern counties with clear Slovakian population. The number of twinning connections are rather low, 78 towns have 200 such connections, and the 1589 villages have altogether 204 twinning partners (Mezei, 2005). Relying on the first experiences of euroregional cooperation point at the conclusions that cooperation is considerably hindered by the differing administrative systems, taxation systems, legal institutions, the differences in the market structures, planning, currencies and languages. At the moment 9 euroregional organisations exist by the HungarianSlovakian border (the year of the establishment indicated in brackets) (Mezei, 2005): • • • • • • • • •
Hármas Duna-vidék (Triple Danube Area) Euroregion (2001), Vág-Duna-Ipoly Euroregion (1999), Ister-Granum Euroregion (2003), Ipoly Euroregion (1999), Neogradiensis Euroregion (2000), Sajó-Rima Euroregion (2000), Miskolc-Kassa Euroregion (1999), Zemplén Euroregion (2004), Kárpátok Euroregion (1993/1996).
The euroregions have made the first steps towards the establishment of well operating institutions or organisations. For the success of such cooperations it is necessary to set up networking connections for the settlements, their natural and cultural heritage, the transport corridors, etc. This should be supported by joint development policy, and this should be continuously implemented, as a part of the everyday work, and not only as an activity to be done only if the external financial resources are available for the project. The Ukrainian-Hungarian borderline The Ukrainian-Hungarian borderline is the shortest piece of border in Hungary, and after Hungary’s accession to the EU this borderline has 142
become an external border of the EU for a long time. This border belongs at the Hungarian side to Szabolcs-Szatmár-Bereg county, while at the Ukrainian side to Zakarpatska (Kárpátalja) county, which means that a peripheral county is situated by another peripheral county of multiply disadvantaged conditions. Szabolcs-Szatmár-Bereg county is characterised by mainly tiny villages, bad accessibility of the settlements, with natural barriers of river Tisza and river Szamos, and not enough possibilities to cross them. There is only one bridge over the Tisza, at Vásárosnamény. The situation is even worse considering the rail connections, because these are built, but they are situated at the opposite side of the border. Considering demographic trends unfavourable processes have been started in the county: extensive outmigration, the increased proportions of the socially and economically unintegrated Gypsy population. Another problem is the high rate of unemployment. At the same time here is the Kisvárda-Záhony microregion with indicators much more favourable than the county average. This is a relatively dynamic area of the region. At the other side of the border there is Zakarpatia, with about 12800 km2 area with very difficult history since the Trianon peace treaty. Since the breakup of the Soviet Union and the establishment of the independent Ukraine, the economy keeps declining. This is the main barrier against the development of cross-border relationships. The wages are low, and are often left unpaid for longer or shorter periods, and the inhabitants cannot do anything else except smuggling and illegal work. Officially in 1999 the unemployment rate was 6% - because noone wanted to register as unemployed, as registration does not mean any advantages, no benefits are paid and no chance to get jobs by being registered. Estimations say that minimum 40 or 50% is the proportion of jobless in reality. For this reason out-migration is strong, the population leaves the region. This is rather problematic for Hungary, because the migrants are mainly of Hungarian nationality, and the more educated, highly qualified part of the inhabitants. The infrastructure of Zakarpatska county is worse than that of Szabolcs-Szatmár-Bereg: roads are badly neglected, there are no healthy water pipelines and sewage drains either, and every day the electricity is switched off for four hours. There is no sense of ownership, all the resources are exploited without consideration. Border crossings There are five border crossings at the Ukrainian-Hungarian border, of which Záhony is of outstanding imporance. This is a fully equipped international crossing station for road and rail traffic. The capacity of the railway station is 21 million tons, and it was construced in the socialist system to provide a switchpoint between the narrow gauge rails of Hungary and the wide gauge rails of the Soviet Union. Nowadays only a fragment of its capacity is utilised with an annual traffic of 5 million tons. In Tiszabecs there is a renewed truck terminal. The border crossing statistics show that after the opening of the border in 143
1988 the travels have increased considerably for a short time, and then a decrease followed till 1992. Then again the traffic increased till 1995, when more than 15 million crossings were recorded. Up to that date Soviet cars could be taken to Ukraine from Hungary without customs duties. Then the customs regulations were made stricter, the traffic of the border has started to decrease and has been decreasing ever since. In 1988 a considerable proportion of the traffic used the railway transport, and then, gradually the smugglers coming by cars have become the largest proportion of the traffic. By 1999 the decreasing trend of the rail travels stopped and the 2000 data show a slow increase again, which indicate the existence of some legal trade again. The connections are hindered by the very bureaucratic procedure required at crossing the border, mainly because of the Ukrainians. An invitation letter is required from the Hungarians and the only exception is if they have a small border crossing permission for persons living in the immediate vicinity of the border. There are various fees to pay: road repairs contribution, environmental charge, etc. Cross-border cooperation works at various levels. First there are institutionalised connections between e.g. settlement and county municipalities. These are partly inherited relations from the past system and often work only on protocol level. Nowadays, however, the religious and the educational cooperations have improved, secondary schools opened in Kárpátalja with Hungarian help, and at the only Hungarian higher education institution, the Hungarian College in Beregovo has teachers from the Nyíregyháza College. There is one thing in common in these relationships: they are all Hungarian-Hungarian relationships, that is, the Hungarian institutions have connections to the Hungarian institutions over the border. In Kárpátalja, that is, in the vicinity of the Hungarian border 110 Hungarian-Ukrainian joint ventures were run in 2000, although their capital assets are rather low (Baranyi, 2004). In Hungary, at the same time 825 joint ventures are found in 2000. Often these are fictitious firms just to facilitate the settling of the owner in Hungary. The most significant connections in this border area are the illegal connections. The most important of them is the smuggling of fuel. By estimates at least half of the agricultural machinery in Hungary by the border is run entirely on smuggled fuel. The other important area of crossborder linkages is illegal labour. According to estimations about 100 thousand workers from Ukraine work illegally in Hungary – most of them in construction or as seasonal workers in agriculture for very low wages. Another serious problem is the smuggling of people, because this border is a transit road to Western Europe (Baranyi, 2004).
3.3.1.3 The Southern Great Plain borderline area The Southern Great Plain region, situated in the south-east of Hungary, has common borders with Southern Transdanubia in the west, Central Transdanubia in the north-west, Central Hungary in the north and Northern Great Plain in the north-east. With an area of 18339 square kilometres, the 144
region is the largest in Hungary but it is also one of the least densely populated regions in Hungary (75 inhabitants per square kilometre in 2003). The region had 1367 thousand inhabitants at 1st January 2003, representing 13.5 % of the total population of Hungary. The region is characterised by the typical arrangement of scattered farm houses, as well as a blend of different cultures, rich folklore and quality environment. The region is also endowed with unique landscape and biological diversity, which allows more intense utilisation of the region for active- and health tourism. It is mainly the abundant medicinal- and thermal water supplies that are found interesting in the market of the increasing welfare tourism. Economic structure of the Southern Great Plain region has been greatly determined by the history and natural resources of this area. In the economic structure, agriculture, having great historical traditions, and food industry have a prominent position. Climate and good types of soil resulted in the fact that agriculture and farming play a leading role in the life of this land. The arable land covered 55.9 % of the area of the region, which was the highest share in Hungary in 2002, while the national average was at 48.5 %. Industrial structure is fundamentally based on excellent quality of arable soil. On the basis of traditions grain crops growing and animal breeding are dominant. The food production of flour milling-, meat-, canning-, and dairy industry give 20 to 25 % of the national production. Besides food industry, farming machine manufacturing, brick-, tile-, as well as glass production built on minerals found here (clay, sand, rubble-stone) is also significant on national level. Additionally to hollow glassware production, sheet glass manufacturing has also appeared. In smaller settlements textile industry, an "accompanying industry" to agriculture, reduces employment problems. Despite the fact that there are few forests in the region, presence of timber industry enterprises scattered around the region is also significant. Energy industry, built on the recovery and partial processing of hydrocarbons found here, has undergone a major development, this way the region is able to satisfy industrial sectors with energy demand higher than the average. Between 1995 and 2001, the Gross Value Added (GVA) of the region has increased by 48 %. The services sector is the most important, representing 60 % of the GVA of the region in 2001, against 64 % nationally. For the same year, the share of industry was 29 %, which was low with regards to the other regions, and the one of agriculture was 11 %, which was relatively high compared to the national average (4.3 %). In 2000, the employment rate of Southern Great Plain was 55.7 %. The share of the employment in the services sector was 58 % in 1999. For the same year, the share of employment in industry was 32 %, which is low with regards to the other regions, and the one in agriculture was 10 %, which is relatively high. The unemployment rate at 6.5 % was in 2001 above the national average (5.7 %). Transportation corridors from the heart of Europe to the Balkans and to the Middle-East are increasing the transit role of the region. Geographical situation and little differences in altitude make the area ideal for railway traffic. The road traffic provides good connections not only to the capital, but also between county seats of the regions. Educational institutions carrying out elementary and mandatory educational 145
tasks are run by the municipalities of the particular settlements. Private kindergartens can be found mainly in the region's bigger cities. Classes from 1 to 8 can be attended locally in the different settlements of the region. The system of intermediate vocational education can meet demands at sufficient levels for all directions and types of training. Wide range of advanced, manifold types of training available in bigger cities can satisfy demands of neighbouring smaller settlements at high levels. Among special courses in the colleges and universities in Southern Great Plain, teacher- and agricultural training as well as medical specialist training are outstanding. Demand for labour market training is met by retraining courses for the unemployed defined by county labour councils. Agricultural research plays a prominent part in research scheme of the region (KSH, 2006). The decreasing trend of the number of inhabitans have shown large changes in the past 10 years. Due to the loss of demographic balance the ageing and the decreasing population has become typical for the villages. This process is true for all the settlements in the borderline at each side of the triple border. The speed of decrease is stable in Hungary, or even a sligh slowing down as a result of external and internal migratory processes. Assessing the age structure the proportion of the elderly has been steadily growing, while the proportion of the younger population has been decreasing. The cross-border programmes of the borderline settlements might be helpful in stopping this unwanted process. The premises of economic activity are the settlements, hamlets, villages, towns. The characteristic feature of the current economic structure is the fact, that in places where the hamlets still exist, it is not only agriculture that provide income for the inhabitants, but the manufacturing sector and tourism, too. Agriculture is the traditional economic activity at both sides of the border. Livestock husbandry (pigs, poultry, cattle) and crop productions (wheat, maize, rye, vegetables, paprika, onions, medicinal herbs, and fruit) play an important role in the life of every family. The structure of traditional commercial agriculture has partly changed, new objectives and targets have emerged. Assessing the structure of the local industry the peripherality is felt not only by small peripherally located settlements, but also the central towns of the region (Szeged, Makó, Gyula, Mezıhegyes, Sarkad). The consequence of this is the strange industrial structure of the region. Recently the most important feature of industry has been the remarkable servicing industry, that used to be an occasional industrial area in the past. A complete change has been observed nowadays. The number of employees has decreased continuously and the proportion of industrial employees has been very low in many settlements. The role of the industrial sector decreases even in towns and shows the characteristics of occasional industrial activity – low levels of productivity, low levels of machinery, obsolete productions structures (PálNagy, 2002). The most typical sign in the region of the borderline location is the great transit traffic of the settlements, the high proportion of the daytime population, and the prospering black commerce and the high levels of environmental pollution. The capacities of the border crossing stations are 146
small and there are other social and political factors that cause serious problems. A lot of foreigners come from eastern Europe, most of them Ukrainians, Romanians, Russians, Serbians and Croatians. They come with trading purposes, as sellers, and selling their goods they get Hungarian currency which they spend on buying goods, these „tourists” bring consumer goods, including spare parts for the machinery and electronic equipment produced by the former CMEA countries and no longer available in normal commercial ways, and they buy food (meat, dairy, bread, cooking oil). The borderline settlements are often unable to supply the demand of these traders, and they are also unprepared for feeding the transit travellers, nor for providing health care or accommodation for them. The size and range of trade was considerable decreased by the avian flu epidemic in 2005, and the restrictions established at the borders in consequence of it. Today the permanent impacts of this temporary decrease are hard to estimate (Pál-Nagy, 2002; Pál, 2002). After the end of the Yugoslavian war and the embargo the economic relationships have started to expand. The cooperation was aimed at the deepening of the economic connections between the borderline territories and settlements, the establisment of a duty-free zone at the triple border. This cannot be done without the cooperation of the association of the borderline municipalities and the active business enterprises of the area. The cross-border traffic is enhanced by the opening of new crossing stations (Gara-Regıce, Bácsszentgyörgy-Rastina, Katymár-Aleksa Satic). In the field of environmental conservation a common task could be the maintenance of the free flow of the rivers running by and crossing the border, and the prevention of their pollution. A joint spatial development plan seems to be a reasonable approach to the problem, in which attention should be paid to economic, social, environmental and infrastructural cooperation and joint action for development. Results and achievements of the cross-border cooperation The county Csongrád has traditionally long standing cooperation with the Subotica Economic Chamber for more than 10 years, which has been practically closed for the period 1992-1995 because of the war and the embargo. After the lifting of the embargo the connections became vivid again the demand of the entrepreneurs increased for the information related to trade techniques for this direction. The connections established with the partner economic chamber in the opposite side of the border could be very useful for this purpose. The cooperation agreement signed in December 1995 contains the mutual and free exchange of basic information about business firms operating at the two sides of the border. Considering foreign direct investment it can be stated that the Great Plain and the borderline zone are not particularly favoured by FDI, and foreign entrepreneurs. In the larger towns and cities, in Szeged, Subotica and Törökkanizsa has outstanding numbers of enterprises with owners coming over the southern border. The majority of them are from the towns of Vojvodina – Subotica, Zenta, Kanizsa, Ada and Novi Sad. As a result, in Szeged shop chains have been established, which are characterised by doing 147
several things at the same time, and being successful. Today many enterprises have been established with little capital and with the motivation to be able to work in Hungary without the necessity to apply for work permits. Among the non-producing activities commerce, research-development and innovation are the two main activities that may have a role in shaping a region. After the transition in 1990 the western commodities could reach the markets at the eastern borderline and the Serbian consumers quickly entered these markets. During the embargo the legal commercial activities decreased, while black markets flourished, and this has not changed after the lifting of the embargo either. Due to the cheap petrol sales by the opposite side of the border the Hungarian petrol stations in the vicinity of the border went bankrupt (Pál-Nagy, 2002). A positive change is the emergence of many commercial organisations and the sales volume and the ownership structure of retail trade has been rearranged at the settlements. In the services sector the development of tourism may be a good opportunity. The touristic resources of the borderline area are felt in the two Serbian cities Subotica and Zombor, and in Hungary Szeged and Baja and even Kiskunhalas, where the volume of shopping tourism is considerable. Another touristic attraction could be the ecotouristic endowments and the spas of the Great Plain area, as well as the natural endowments by the rivers Danube and Tisza. This purpose is served also by the nature reserve areas at the opposite side of the border, which would be reasonable to develop together with the Hungarian nature reserve areas, in the same system. In the southern borderline the joint water flows should be utilised together with Serbia and Romania. Another important aspect of the cross-border traffic is the development of international transit travels towards the Balkans. For the improvement of the present situation the capacities and the quality of the crossing stations should be developed, and a few new crossing stations should be established between the cooperating neighbour countries. It would also be important to fit the timetables of the public transport, buses to each other at the two sides of the border. The buses going to the larger towns, cities should stop at the border crossing station and not only at the nearby village – which requirement is not always met currently in the Hungarian area. It would be also a useful thing to check the bus timetables of the neighbouring countries so that if a bus does not cross the border, then it would be possible to find a connection bus at the other side of the border towards the nearby settlements. This would improve considerably the traffic connections of the people living in the borderline areas and strengthen the gateway character of the region. The road transport is the most used form of traffic by the border. However, it is a disadvantage that the public transport system serves only the settlements lying by the main roads, thus all the other settlements have become declining, disadvantaged and closed settlements. There are border crossing stations which cannot be accessed any other way only by car. 148
Recently the reconstruction and modernisation of the railways, and the establishment of the logistics centre in Baja are expected to lead to the growing importance of the southern borderline. The cross-border development possibilities The borderline cooperation development programmes are fitted to the European practice of programming, based on the national development plans of the countries involved. The problem with the HungarianYugoslavian cooperation in this regard is, that the Hungarian side has the necessary institutional structure for this process, but it is still missing on the Yugoslavian side. The impact of the operative programmes may be the speeding up of the establishment of regional institutions in Yugoslavia as well. Transboundary cooperation was organised within the framework of the INTERREG programme of the EU. In Hungary first the PHARE CBC provided funding for cross-border cooperations, and the Romanian borderline was involved in such programmes with Hungary. Besides PHARE CBC and INTERREG the region utilised resources from other cooperation programmes PHARE Credo programme, PHARE ECOS-Ouverture programme, Interreg II. C program). Unfortunately the Yugoslavian borderline areas could have access to the EU financial resources only to a limited level. A basic physical condition for cross-border cooperation is the penetrability of the border, that is, the availability of suitable roads and the sufficient numbers of border crossing stations of sufficient capacities for passenger traffic, and commercial transport. There is need to build out the M5 motorway to the border, and to establish further roads and modernise railways, to make river Tisza an international waterway to facilitate the establishment of the gateway function. After the accession of Hungary to the EU the increase of connections, transport and trade are expected and also the settling of Yugoslavian businesses to Hungarian territory. Another important task is the development of border crossing stations, including the customs facilities, because at the external border of the EU this is an important resource of income. In order to make the border easily penetrable the establishment of efficient logistic services is also recommended. The target group of economic development by the border is the small and medium-size enterprises, both in agriculture, industry and tourism. Including the access to information, innovation incubation, export oriented marketing and development of clusters. The development of institutions, education, modern information technology are all preconditions and tools of establishing successful cross-border cooperation programmes. It must be remembered that the Southern Great Plain area has two neighbours, Romania and Yugoslavia, and several transboundary programmes, the areas of which are often overlaying. This means, on the one hand an enriching feature for the region, but it also necessitates the careful 149
coordination of actions and partial programmes. The Hungarian – Romanian conception of borderline development are mainly in agreement with the Hungarian – Yugoslavian development plan, and it provides a basis for coordinated action to the advantage of all the three countries involved. The actual transboundary economic relations of the region The most important existing cross-border connections are the cooperations of chambers, the Euroregional cooperation of the Danube-Körös-TiszaMaros, the enterprise development centres, the industrial parks, and the twin town or microregional connections (Pál, 2002; Pál-Nagy, 2002). Among the transboundary connections the cooperations of the chambers are the most developed, and have longest traditions. Besides the Serbian chambers the Romanian chambers have also taken part in these cooperations, so it covers the whole triple border area. The cooperations are formalised and regular. Their declared objectives are the expansion of the direct connections of enterprises, the joint participation in fairs and exhibitions, and the organisation of business meetings, exchange of information about the economy, legislation and markets of the neighbouring countries. The targeted areas of cooperation in the Serbian-Hungarian cooperation are commerce, wood industry, food industry, clothing, furniture making, business consultancy. The main result of the cooperation is the establishment of an institutionalised network of connections, which organises business meetings and regular chamber meetings and presentations at exhibitions. The Danube-Kırös-Maros-Tisza (DKMT) Euroregional cooperation has been built on the cooperation of the chambers. The main purpose of the Euroregional cooperation is the enhancement of the economic development and self-management of the region, and to create respect for the enterprise. Successful cooperation is hindered by the lack of sufficient financial resources, the DKMT relies entirely on EU funding. The European Business Information Centre was established in Szeged from the support of PHARE CBC. It is difficult for the DKMT to establish joint progammes with Serbia because the latter can use financial resouces from the EU only to a limited extent. This makes the two southern border lines imbalanced, as the RomanianHungarian cooperation shows exceptionally dynamic development. A good example for the cooperation between enterprise development centres is the cooperation between the Bács-Kiskun County Enterprise Development Foundation and the Magnotron Ltd in Subotica. They signed a cooperation agreement in 1995 with the aim of developing small and medium-size enterprises. The cooperation covers the following areas: • Joint organisation of a trade fair in Subotice, • Organisation of meetings of successful businessmen or women, 150
• Organise a conference about the privatisation and company establishment possibilities, • Participation of Yugoslavian partners at the Halas Expo. The enterprise development foundation also takes part in the activities of the DKTM Euroregion, and its offices in Baja and Kiskunhalas provide information services for Serbian entrepreneurs. Formerly it used to have a similar office in Subotica but due to the political uncertainties it was later closed down. They also cooperate with an Arad chamber and they took part in the organisation of the Subotica fair and in organising business meetings. The Mórahalom Industrial Park focuses on the encouragement of Yugoslavian businesses to come and settle in the Hungarian borderline, and utilised tools of direct marketing for this purpose. Due to the impacts of the Yugoslav war the progress have been slow. The Makó Industrial Park is oriented towards Romania. A good example for the cooperation between microregions and twin settlements is the cooperation agreement the microregions of Homokhát and Kanizsa signed in 1999 with the objective of cooperating in economic, cultural and environmental areas. A similar agreement was prepared between the Subotica microregion and the microregion of Homokhát, too. Twin towns in the region are Baja – Zombor, Kiskunhalas – Kanizsa, Békéscsaba – Nagybecskerek. The Baja – Zombor cooperation is very active and although it is unusual for the twin town cooperation, it also covers the economic connections. The agreement specifically mentions the following targeted areas: economy, tourism, transport, education, etc. In 1997 they organised a very successful meeting for business people, too. The town twinning cooperation also operated during the war sending humanitarian aid from Baja to Zombor. Kiskunhalas and Kanizsa cooperate mainly in cultural and sports events, but there are examples of business cooperation, too: • providing opportunity for the partner town to participate free of charge at the Halasi Industrial Fair, • provide possibility for the enterprises of the partner to be included in the Halas company register, • Békéscsaba and Nagybecskerek organise business meetings, sports events and tourism cooperation.
3.3.1.4
Southern-Transdanubia, the Austrian-Slovenian-Croatian borderline
Situated in the south-west of Hungary, Southern Transdanubia has common borders with Western Transdanubia in the north-west, Central Transdanubia in the north and Southern Great Plain in the east. The southern border is an international one, with Croatia. Southern Transdanubia covers an area of 14169 square kilometres and it is the least densely populated region of the country (70 inhabitants per square kilometre in 2003). The region had 989400 inhabitants at 1st January 2003, 151
representing 9.8 % of the total population of the country. The touristic potential of the region is guaranteed by the whole southern shore of Lake Balaton located at the northern boundary of the region and the MecsekVillány Hills in the south, famous for its outstanding vine culture and wine production. Although there were several layoffs in coal and uranium mining, the limestone stock of the region is suitable for cement production, or having changed colour in some places, can be used as marble. The performance of the atomic power station in Paks is vital in the region, while the big number of rivers enable industry to settle down there, which has not been the case until now. In 2001, Southern Transdanubia was ranked at the fourth place among the regions regarding the Gross Domestic Product per capita with EUR 4275 per inhabitant. There are as many as 1350 companies with foreign ownership settled in Southern Transdanubia and the number of companies owned by Hungarians is also slowly developing. The industrial development strategy of the region can be based on the large companies and enterprise development organisations operating in Southern Transdanubia. It is justified by the fact that 18 industrial parks have been set up in the region so far. They offer communication services and supporting facilities for newly established businesses. The production sector is dominated by agriculture with the connected food processing industry, energy production, and tourism. However, there is a significant increase in the high-tech sectors as well. In 2001, the employment rate of Southern Transdanubia was 52.3 %, while the unemployment rate was 7.8 %. In 2001, the primary sector accounted for 8.4 % of the Gross Value Added of the region, which was more than 4 percentage points higher compared to the national average. The opposite trend appeared for the secondary and tertiary sectors, with respective shares of 30.8 % (against 31.3 % nationally) and 60.7 % (against 64.4 % nationally). The sector of electric power production is more developed than the national average. The improvement of the transportation facilities of the region including roads, railways, waterways, and airfields - has a key role in the dynamic development of the region. Furthermore, protecting the values of the environment has always been a priority of the region, as it is well shown by the recultivation activities after closing down the coal mines acknowledged all over in Central and Eastern Europe. The endowments of the region make its lands excellent for agricultural production. As much as 80 % of the region's surface is arable land and the proportion of forests is also significant. The sub-Mediterranean climate of the land is beneficial for agriculture as well. As a result, the region has a prominent position on national level in the production of maize and it is one of the country's most important vine-growing regions. The region is rich in minerals and the only nuclear power plant of the country operates in Paks. This is why 40 % of Hungary's electric power supply is produced in Southern Transdanubia. The region's endowments in the field of tourism are excellent. It is rich in thermal and medicinal waters offering good conditions for developing tourism. Therefore, one of the short-term priorities of the region is the promotion of medicinal tourism.
152
Southern Transdanubia is one of the intellectual centres of Hungary. The region follows Budapest and its environs concerning the number of higher education students compared to the number of inhabitants. Both Pécs and Kaposvár are university centres with an influence on the whole of Transdanubia. The picture is completed with the academic training performed in Szekszárd and Paks. Pécs is an important intellectual basis of the country, the home of the University of Pécs and the Centre for Regional Studies of the Hungarian Academy of Sciences (KSH,2006). In spite of various economic endowments the development levels of the settlements are very varied (Molnár et al., 2003; Molnár, 2006). It is difficult to reach the South Transdanubian Region from any direction. It is the result of the historically developed radiate structure of the Hungarian transportation networks and the unfavourable geographical endowments (waterways) that the region is left out of the main European and interregional flows of transport – forming an enclosure which is hard to reach. Due to the radiate structure, the international routes crossing the region offer high quality access only in the direction of Croatia, and only for a limited number of inhabitants as the main transportation routes pass by the peripheries of the region, thus the whole of the region cannot benefit from them. In all other directions, there are roads of poor quality and railway lines. To put it briefly, we live in a region, which is far from any other place – not because it’s distance but for it’s accessibility. The relative advantages of limited geographical distances may not have a beneficial effect, due to the lack of direct roads and railway lines of good quality. Under such transportation conditions the region is not able to play its role to “be a bridge” in international cooperation – linking the developed territories in Northern-Italy and Germany, and the Balkan region – as there are other Hungarian regions with much better transportation endowments to play such "bridge role". The only way to improve the bad accessibility of the South Transdanubian Region is to develop transversal transportation links (motorways, renewed railway lines, well organised timetables offering less changes of lines) – both in the western/north-western and eastern directions – and to create more crossing points over the River Drava (DDRFT, 2003). The objective of the Croatian-Hungarian cross-border cooperation is to maintain the existing links and to establish new ones between the OsijekBaranja, Virovitica-Podravska and Koprivnica-Križevačka counties, and the South Transdanubian Region. Key areas of cooperation development are: • • • • • •
Social and cultural cooperation, Tourism cooperation, Cooperation in the fields of economy and foreign trade, Educational-training cooperation, Cooperation in the field of nature preservation and the protection of the environment, Supporting the implementation of investments related to communal and transport infrastructure, 153
• • •
Disseminating modern regional development knowledge in the border region, Elaboration of joint projects in the above fields, Supporting the EU accession of the cross-border partner counties in Croatia.
The most important field in the cooperation of Hungary with Slovenia is the improvement of business links together with other intensified institutional cooperation, mainly in the field of spatial planning, environment, culture and sports – built on the relative geographical closeness of the region. However, to achieve the above goals the Hungarian borderline needs to have its accessibility improved, developing public transport facilities between the two regions, focusing on the regional centres: Pécs, Ljubljana and Maribor. The parallel accession of the two countries to the EU in 2004 has created new possibilities in the field of project-based cooperation. Links with Carinthia, Styria and Burgenland: In the cooperation with the Austrian border regions the links with Styria dominate the international relations of South Transdanubia. The main areas of cooperation are the following: In case of Carinthia the objective is to improve bilateral links in the field of tourism; cooperation in research, innovation, development of a regional transportation network (M9); and the improvement of links in the framework of the existing regional cooperation (EU Future Region, CONSPACE project). In case of Styria the cooperation should be developed in the framework of the existing organisational links (Alps-Adriatic Working Community, „EU Future Region”): elaboration of joint programmes (innovation, R&D, economic development), harmonized lobbying in “regional diplomacy” (joint initiatives in international organisations, forums and at the national governments), improving transportation connections with Styria (with closer links to the Trans-European Network for transportation) together with improving the existing Styrian links of the municipalities and the counties. In case of Burgenland we need to focus on establishing links with the regional development working organisations of the province, the elaboration of joint business and tourism projects (e.g. in the area of viticulture), cooperation in regional nature preservation and environmental projects, as well as projects in the field of railway development (Vienna-Pécs direct access) (DDRFT, 2003). Links with Vojvodina and Western-Serbia: It is important both for South Transdanubia and for the stabilization of the southern Slavic region to (re)establish links between South Transdanubia and the Vojvodina region, and expanding the cooperation to new fields, in particular: economic development, tourism cooperation, cooperation in the field of protecting nature and environment (Danube-Drava National Park), improving accessibility. 154
Bosnia-Hercegovina – with a special focus on Tuzla Canton – is a partner region of strategic importance for South Transdanubia. Bosnia-Hercegovina may break out from its present political and economic isolation only through Hungary, in which a key role may be played by South Transdanubia. The interstate relations – diplomacy and business links – between Bosnia and Hungary are to be developed significantly, with an initiating role to be played by South Transdanubia – based on its historical links, and its favourable location. With Tuzla Canton successful cooperation may be established in setting up industrial parks and enterprise zones, as well as new border crossing stations which may attract foreign – including Hungarian – working capital investments into the Canton. It is important to improve the transportation links between the two regions through a motorway/highway along the line of the V/C corridor (the a motorway in the Trans-European Network leading from Budapest to the South, as far as the Adriatic Sea, via Serbia and Bosnia-Herzegovina). Links between the higher education institutions need to be developed, as well as cooperation in the fields of R&D, culture, exhibitions, fairs, integrated regional marketing with the introduction tourism projects and environment-conscious programmes in the field of ecology. An efficient cooperation should be established in the framework of the Danube-DravaSava Euroregion (elaboration of joint projects, assistance for the implementation of EU-supported programmes) with a special focus on the Euro-Atlantic integration of the region (DDRFT, 2003). The cooperation plans The development of the TEN corridor V/C is of essential importance for the entire region. It plays the role of a bridge between Hungary (Budapest, and through Parassapuszta toward Slovakia) and the South-Adriatic seacoast, linking Szekszárd, Pécs, Osijek, Sarajevo, Mostar and the port of Ploče. Establishing new crossing points on the Hungarian-Croatian state border The governments of the Republic of Croatia and Hungary in the autumn of 2003 made a bilateral agreement on the control of highway, railway and waterway border traffic, in which the signatories stressed the need for improving trade between the two countries, also by means of establishing new crossing points between Molnári and Kotoriba, Belezna and Donja Dubrava, Vízvár and Ferdinandovac, İrtilos and Legrad, and between Révfalu and Sopje. Development of joint bicycle lanes in the Croatian-Hungarian border region, establishment of joint eco-touristic space The seriously disadvantageous micro regions along the Drava river could benefit from the establishment of a joint eco-tourism space on the Hungarian and Croatian side of the border. One of the elements of this plan is a cross-border network of bicycle lanes. This infrastructure could link the border-side settlements into a joint tourism supply, and reveal the most undeveloped areas of the region. The project could also ease the bad 155
accessibility position of the entire region: in the framework of the bicycle lane it could be possible to establish new border crossing points for cyclists. Establishment of an effective railway connection between the centres of the EU Future Region The realization of the intercity connection between Pécs and Vienna is a serious step toward the improvement of the difficult accessibility position of the region. The new connection can be sustainable only in case of a competitive timetable and effective transfer possibilities. This time the connection between Pécs (and other regional centres) and Zagreb, Ljubljana, Maribor and Graz are still unsolvable, while the connection between Pécs and Osijek is far not effective. There is a need to extent the network of railway routes that reach the region and establishing effective change facilities between the mentioned central places. The most important would be the linkage of Pécs and Zagreb that could be solved by an effective transfer in Gyékényes. It presumes serious cooperation between the actors of the region and the Hungarian State Railways. South Transdanubia – based on its geographical position and initiator role in several cooperations (Dabube-Drava-Sava Euroregion, EU Future Region) – could play a crucial role in harmonizing cross-regional border programmes, development of projects and network building. It can revalue the role of the region and increase the importance of Pécs, the regional centre: Pécs could be not only the economic, political and cultural centre of the South Transdanubian Region, but also a central point of a wider region from the Austrian-Hungarian border to West-Serbia and North-Bosnia. In order to exploit this advantageous position there is a need to better harmonize the networking policy of the region, the counties and towns; the improvement of the efficiency in cooperation between other regions and significant town centres; enhance the operativity of further cooperations, etc. Since the viability of both the Danube-Drava-Sava and the EU Future Region are of strategic importance for South Transdanubia, the region had to act as an initiator toward the partners in order to ensure the basic institutional conditions for the further common work. This could be supported by the establishment of a regional development or coordination office, in order to carry out project management, project development, coordination and contact keeping in the framework of DanubeDrava-Sava and the EU Future Region, could organize conferences and meetings. This initiative could be fostered by the new neighbourhood policy of the European Union for the budgetary period of 2007-2013. “Territorial cooperation” has become priority 3 of the regional policy (DDRFT, 2003).
3.3.1.5 Cross-border activities of Western Transdanubia Western Transdanubia is the second most developed region of Hungary. It comprises three counties: Gyır-Moson-Sopron, Vas and Zala. The towns richest in historical monuments in the whole country are situated in the mountainous region bordering on Slovenia and Austria, including the 156
building complex of the Pannonhalma Abbey (Pannonhalmi Fıapátság), the guardian of the Hungary's cultural treasures, which has become part of the world heritage. With 1 004 thousand inhabitants at 1st January 2003, the region represented 9.9 % of the total population of Hungary. The region of Western Transdanubia produces around 11 % of Hungary's total Gross Domestic Product. In the region, agriculture is especially important in Gyır-Moson-Sopron county due to the more favourable natural endowments. The region is highly preferred by foreign investors: in 2001, 12% of foreign investments were directed to this region, especially to GyırMoson-Sopron county. 296 foreign enterprises were in the region's agriculture. In 2001, the region accounted for 10.3 % of the country's Gross Value Added. The share of the primary sector (4.3 %) was comparable to that observed nationally. At the opposite, the share of industry was especially high in the region (43.9 %, more than 12 percentage points over the national average). The tertiary sector represented only 51.8 % of the Gross Value Added, while this share was 64.4 % nationally. Tourism alone accounted for 2.3 % of the Gross Value Added. Firstly, the region is rich in thermal springs: people can enjoy the soothing effects of the baths in Balf, Sárvár and Bükfürdı. But the various types of red wines of the region and the colourful vintage season celebrations around Lake Fertı are other tempting reasons to attract tourists. The famous wine-growing areas of the region are the one in Zala, producing white wines, the one in Pannonhalma-Sokoró known for its spicy white wines and the one around Sopron. The entire area of Kisbalaton is a nature conservation area. FertıHanság National Park was formed for preserving the wildlife of its marshlands. In addition to protecting the special sub-Alpine flora and fauna of the lower region of the Alps, it is also responsible for protecting the small villages forming part of the historic monuments in the area (KSH, 2006). The society and the economy of the region shows a varied picture, and although economic indicators generally rank it high among the Hungarian regions, it has many small villages with rather underdeveloped circumstances (Molnár, 2001). The evolution of the border and the borderline region The Austrian-Hungarian border, similarly to our other state borders, is a young, new border, established after the peace of 1920. It has several specific features, that distinguish its history from the history of our other borders. Between the two world wars the new borders were of the strongly separating character as the political relationships necessitated. In the multiethnic and multicultural area Croatians, Hungarians and Germans lived in both sides of the border and they could maintain their personal ties. In the settlement structure, however, the development of the towns were hindered by the fact, that the border cut them off their former area of attraction, and this was especially difficult for Sopron, Mosonmagyaróvár and Szombathely. Burgenland, established from the fragmented parts cut off the Hungarian territory, remained without a considerable town, or central settlement. The real separating role of the border has started to evolve after World War II, from the end of the 1940-ies and the beginning of the 1950157
ies. At that time the formerly easily penetrable Austrian-Hungarian border became the separating boundary between two different world orders, with strategic importance and that has drawn the special attention of the actual political powers to the border. This is the reason why the notorious „iron curtain” (made of fences and land mines, and very strict border control with limitations travelling across the border) was created here besides the Hungarian-Yugoslavian border. The land mines had not been removed until 1965, then a new system of electric fences was established there by the Hungarian border control authorities, which was demolished only in the summer of 1989. The other borders of Hungary with the other socialist countries have also been strictly separating borders, but the travel possibilities were less restricted in those directions, than towards Austria. The significant change in this respect was the introduction of the world passport in 1987, and, as a result, a formerly inconceivable mass of Hungarians started to go to Austria, mainly with the purpose of shopping. The changes of 1989 - 1990 and Austria’s accession to the EU resulted in several changes in the life of the Austrian-Hungarian border. The economic opportunities and later the Schengen requirements directed the attention of the political powers to the Austrian-Hungarian border area, but now with positive attitudes. The events of the neighburing countries created essential problems for the other borderlines. The demolition of the former Yugoslavia and the following wars, the deep recessions in the economies of Romania and Ukraine and the resulting impoverishment of the population, the increasing nationalistic tendencies of Romania and Slovakia all had negative impacts on the developments of the other borderline areas, and have lead to closed borders for several years (in Baranya county) or to criminal affairs (by the Ukrainian borders) preventing any kind of developments in these area. On the contrary, in the nineties the Austrian-Hungarian border has experienced peaceful development, where besides smuggling (mainly smuggling of persons), illegal labour and the illegal land rents in the Hungarian side the inhabitants experienced stable economic development (Hardi- Nárai, 2001; Hardi, 2004). Transport infrastructure The spatial structure of the region is essentially determined by the presence of the Vienna-Budapest transport channel, the most dynamic transport axis of the Carpathian Basin, with its developed roads, railway and the waterway of the river Danube. The directions of communication run parallel with the Danube, that is, North-West to South-East, while the north-south connections are weak. This direction characterises the communications of the three central cities, Vienna, Bratislava and Gyır to each other, and the main directions are Gyır-Vienna and Bratislava-Vienna. Considerable infrastructural facilities are present for the North-West to South-East direction. Motorway connections and large capacity border crossing stations are found at Hegyeshalom. The infrastructural facilities of the north-south direction are considerably weaker. The extension of these capacities is expected, because it is an essential component for the establishment of the 158
internal cohesion of the West Transdanubian region. At the same time, such a road and rail corridor is in the interest of Austria, too, because it would decrease the environmentally polluting transit transport from Austria and from Bratislava to Slovenia. The Austria – Hungary border The state boundaries are no real barriers to the connections of the spatial channels nowadays. Currently the Austrian border is the most developed border of Hungary in several respects. Considering transport facilities, this is the only border of Hungary with motorway connection and highly developed railways with double rail connection suitable for train speeds of 160 km/h. The density of border crossing stations is satisfactory. Although the border is a Schengen border, the waiting time for the passenger traffic and the cultural standards of the crossing are much better than at the eastern borders of Hungary. Hegyeshalom is one of the most popular border crossing stations with large numbers of crossings, with road and rail crossing facilities. More than 10 million people cross the border here annually. The traffic is of the similar volume in Sopron, with more than 8 million crossings per year, and Rábafüzes, too, again with road and rail crossing facilities. In these directions the proportion of the Austrian and the Hungarian travellers remain below 50 %, because these directions lead to the main international travel directions and the majority of the traffic is transit traffic. The smaller crossing stations, such as Kópháza, Bucsu are mainly favoured by Hungarian and Austrian citizens, while the smallest, as Fertıd, Bozsok, Szentpéterfa, Fertırákos are targeted at serving the inhabitants of the region, and are generally restricted for Austrian and Hungarian citizens, some of them are open only for a limited time. The temporary openings specifically serve the local needs, when the settlements at the opposite sides of the border request it occassionally for a celebration or feast for the neighbouring villages (Nárai, 2004). The society of the region In the decades before 1990 the closed border has definitely negative impacts on the development of the borderline areas. The peripheral situation has been maintained artificially by the Austrian-Hungarian borderline until the middle of the 1980-ies. This meant limitations on the investments, leading to economic and infastructural disadvantages and to measurements restricting the movements of the local and the visiting inhabitants. Out-migration has been typical for the region and the demographic situation has deteriorated. After the introduction of the world passport and the transition the border has no longer meant a barrier for the inhabitans to establish daily relationships with the other side of the border, and resulted in considerable improvements in the economies of the borderline areas. It was the region where the inhabitants requested the world passport in the highest proportions by 1989, showing the dynamism of the cross-border connections. 159
Before 1989 the travel restrictions have kept the Hungarian travels to Austria at a low level, but since Austrians could come to Hungary there were connections between the inhabitants of the borderline regions. After 1989 and with the introduction of the world passport in Hungary the Hungarian travels to the west have remarkably increased, and the majority of the connections have also been established after this date. The relatively high proportion of the connections show that the picture the people form about the neighbouring country are mainly based on their own experience. Shopping tourism involved relatively wide strata of the Hungarian population at the beginning of the 1990-ies. Since then the Hungarian shopping tourism has decreased because the products formerly bought in Austria have also become available in Hungary, and the prices have been very similar, too. Shoppers from Austria have been coming to Hungary, but their numbers have been also diminished, because the price differences disappeared in the case of the commodities they used to prefer, too. Nowadays the travels are targeted at shopping or business relations or recreational purposes. The relationships between the inhabitants living at the opposite sides of the border are not limited to consumption and shopping but very often include personal interactions between people knowing each other. In the case of Hungarian travellers working in Austria has become an important objective nowadays, partly in official, partly in illegal forms. Another form of interaction is the purchase of Hungarian real estate by Austrians, that started at the time of the privatisation and land recompensation process in Hungary. Some foreign owners could access resort sites on their own right (about 3 to 5 % of those entitled to recompensations), but by purchasing land recompensation vouchers, and by their presence at land auctions the Austrian interest was often observable. Approximately 10 to 15 % of the arable areas of the two Hungarian borderline counties are rented by Austrian farmers (Rechnitzer, 1999b). Altogether, the economic dynamism, the labour opportunities contain considerable advantages for the population of the western borderline areas. The economy The present economic connections over the border have historical foundations. The areas by the Austrian-Hungarian border had been the food suppliers for Vienna for centuries. The economic situation of the area has completely changed since the transition in Hungary. The Hungarian areas by the Austrian border have become the target areas of the incoming western capital investments and the formerly remote and peripheral borderline areas suddenly became very valuable. Another factor contributing to this was the geographical location, the long traditions of relationships, the traditional work culture and the developing high quality transport infrastructure. As a result, the capital attracting power of Gyır-Moson-Sopron and Vas counties has become outstanding in comparison to the national average. The foreign direct investment per inhabitant was the second highest in this area after Budapest. In Gyır-Moson-Sopron county Austria is the second biggest 160
investor of FDI and the small and medium size enterprises of Burgenland and Vienna are also important investors. Similarly, the Austrian connection is seen in the construction of the Gyır Trade Center build with the support from PHARE in 2000, together with the Schwechat World Trade Center, and the Danube port at Gönyő, also with Austrian capital and PHARE support. In January 2001 altogether 4231 companies were run in Hungary with Austrian involvement, about half of them in Budapest. The Austrian involvement is considerable in the economies of the borderline towns. In nearly all relatively significant centres large numbers of Austrian companies are present, most of all in Gyır, in Sopron, in Szombathely, in Mosonmagyaróvár, in Szentgotthárd, but they are also present in smaller, but important towns as Bük, Fertıd, Kıszeg. Due to the investments the employment structure has undergone considerable changes, and this change somewhat differs from the Hungarian average. While for Hungary as a whole, the industrial and agricultural employments decreased considerably by the turn of the century in the Austria-Hungary border region it is true only for agriculture. Here the dominance of industry, manufacturing has remained strong, or renewed, and it was accompanied by the strengthening of the tertiary sector. By the end of the 1990-ies the Austrian-Hungarian borderline is the only area where the development covered contiguous areas while elsewhere the borderline development is linked to the favourable position of some large town near the border (Pécs, Szeged, Debrecen). Burgenland Burgenland is a relatively small province with the area of 3966 km2 and 277 thousand inhabitants. It was formed from the western peripheries of royal Hungary, from the fragments of Moson, Sopron and Vas counties. It is very long in the north-south direction and very narrow in the east-west direction. The road constructions of the recent years have considerably improved its situation, but transportation connections do not really ensure the internal cohesion of the province, because the real traditional communication channels connected it to the Hungarian central towns and the Austrian capital. Due to the definition of the border, the province was left without any important regional centres. Its main settlements are the former free royal town of Eisenstadt and Rechnitz, and some smaller settlements. The real regional centres used to be Sopron, Kıszeg, Szombathely and Szentgotthárd. The present towns of the province have grown from former villages (e.g. Oberwart). The main centres are still outside the borders of the province, Wiener Neustadt and Vienna, even for the settlements of southern Burgenland. The settlement structure of Burgenland is characterised by the many small settlements, besides Eisenstand all the settlements have less than 10000 inhabitants, and 65 % of the settlements have populations between 500 and 1999 persons. Within Austria Burgenland is the least developed province, but it is also the one with the most dynamic among the Austrian provinces. The GDP/person 161
is only 65 % of the country average. The share of agriculture in the GDP and in the employment is the highest in this region of the whole of Austria. The share of industry is low, leaving a relatively high share for the tertiary sector. Generally the northern part of the province is more developed than the south, due to the traditionally more developed agricultural sector, formerly typically the modern technologies of the large estates, and nowadays the adaptive agricultural production, wine production and increasingly the tourism sector and the vicinity of the capital, Vienna. During the last ten years the development of the province was faster than the national average, due to the considerable decrease of the role of agriculture, while the other two major sectors showed considerable growth. The growth of the service sector, and particularly tourism, has a crucial role in growth. As it can be seen, by the Austrian – Hungarian border two regions meet where the economies have quite different features. While in GyırMoson-Sopron and Vas counties development is driven by industry, in Burgenland it is the developed agriculture and tourism. Both areas are similar in being the most dynamically developing regions of their own countries, and this dynamism may be the guarantee for the joint development of the borderline areas. The cross-border cooperations Cooperation was boosted by the two borderline regions at the opposite sides of the border. The Hungarian borderline region (the West Transdanubian region) is a developed region of Hungary, with good infrastructure by Hungarian standards, and developed industrial traditions, lively economic and social connections. The Austrian borderline province, Burgenland, is probably the least developed region of Austria, without any considerable towns as regional centres, and weak social cohesion. The similarity in the two borderline areas is their dynamism. The readiness of dynamic regions to build cooperation is generally much greater than that of the peripheral, underdeveloped regions. Thus, in Hungary the borderline region by Austria may be the first really „transboundary” region, for which the communication directions are not dominated by the national centres. The accession of Hungary to the European Union is very useful for this development. The favourable political changes in Hungary resulted in the opening of the border and the disappearance of factors formerly preventing or hindering the cooperation of settlements and regions. The initiation, establishment and maintenance of bilateral connections have been allocated to the level of the local municipalities, and civilian organisation, and this is the level where extensive and varied types of cooperations may be established. Nearly all of the borderline settlements have cross-border relationships, which are mainly cultural cooperations, but there are examples of economic and infrastructural cooperations as well (e.g. Szentgotthárd—Heiligenkreuz Industrial Park; Szentgotthárd—Jennersdorf sewage treatment agreement, etc.). The local settlement-level cooperations are mainly official, formal, and they are presented for the population only in cultural or sports events.
162
Chapter 4 - The Croatian – Hungarian borderline 4.1
The area and population of the Croatian – Hungarian borderline
The public administration system of the Republic of Croatia is divided into local (town and district) and regional (county) level municipalities. There are altogether 20 counties, 123 towns or cities and 426 districts in the country.
Figure 4.1: The counties of Croatia Source: Croatian Bureau of Statistics, 2003 Within the framework of the present research project three borderline counties have been assessed, namely Koprivničko-križevačka (KoprivnicaKriževci) county with the centre Koprivnica; Meñimurska county with the centre Čakovec and Virovitičko-podravska county with the centre Virovitica. The sizes of the three counties are very different as well as their population densities and economic potentials. 163
Table 4.1: Towns and districts in the assessed three counties County Koprivničko-križevačka Meñimurska Virovitičko-podravska
Towns
Districts
Population number Population density persons/m²
Number of towns 3 3 3
Koprivničkokriževačka ðurñevac Koprivnica Križevci Drnje ðelekovec Ferdinandovac Gola Gornja Rijeka Hlebine Kalinovac Kalnik Kloštar Podravski Koprivnički Bregi Koprivnički Ivanec Legrad Molve Novigrad Podravski Novo Virje Peteranec Podravske Sesvete Rasinja Sokolovac Sveti Ivan Žabno Sveti Petar Orehovec Virje
124 427
Number of Centre of county districts 22 Koprivnica 22 Čakovec 13 Virovitica Counties Meñimurska Virovitičkopodravska Čakovec Orahovica Mursko Slatina Središće Virovitica Prelog Crnac Belica Dekanovec Čačinci Čañavica Domašinec Gradina Donja Dubrava Lukač Donji Kraljevec Mikleuš Donji Vidovec Nova Bukovica Goričan Pitomača Gornji Mihaljevec Sopje Suhopolje Kotoriba Špišić Bukovica Mala Subotica Voćin Nedelišće Orehovica Zdenci Podturen Pribislavec Selnica Strahoninec Sveta Marija Sveti Juraj na Bregu Sveti Martin na Muri Penkovec Štrigova Vratišinec 126 500 93 389
71
164
45
Source: Croatian Bureau of Statistics, 2003 The county Meñimurska is the most densely populated of the country with its 164 persons/km² population. Koprivnicko-križevacka county has a population density of less than half of it, only 71 persons/km², while Virovitičko-podravska county is still less populated, with the population density of only 45 persons/km². As the above table shows, the population of the Croatian borderline counties is only 1/3 or ¼ of the neighbouring Hungarian borderline counties. The 164
population of Koprivničko-križevačka county was 124427 persons in 2001, while the population of Meñimurska country was 126500 and the population of Virovitičko-podravska was only 93389 persons. In comparison, at the opposite side of the border there are Baranya county with its 404709 population and 301 settlements (towns and villages), Somogy county with 395701 inhabitants and 245 settlements and Zala county with 297853 inhabitants and 257 settlements. In the Hungarian side of the border the neighbouring areas of NUTS III category are: Zala, Somogy and Baranya megye (county), which belong to two of the recently established NUTS II level regions. Zala county belongs to West Transdanubia region, while Somogy and Baranya counties belong to South Transdanubia.
4.1.1 The description, characteristics of the border region As a result of the common history of the two nations, there are mutually minorities in each other’s territories, most of whom are bilingual and are well entrenched in local society. Relations between the two countries are exemplary. During the Communist period after World War Two, the border constituted a strong line of separation between Hungary, part of the Soviet Bloc, and the constituent republic Croatia of the Yugoslav Federation, an independent, neutral communist state. Due to the political tensions between the two countries, the border area was almost as heavily guarded and fortified as the famous Iron Curtain further to the North. As a result, the border strip on both sides remained a no man’s land, with train and road connections severed, and neighbouring settlements cut off from one another. After the change fall of communism, Croatia became an independent state, and the borders opened up. New border crossings were established, and transit was eased up. During the Yugoslav wars the Croatian side of the border was affected by armed conflict. Due to the increase in regional disparities in Hungary many microregions along the common border have become impoverished. When the Slavonian economy was left devastated by the war, there was considerable shopping tourism from Croatia to Hungary. The new customs regulations introduced in 2000 caused a considerable, although temporary, decrease in the traffic across the Croatian-Hungarian border and in the trade incomes by the border, as it had been the normal way of life in the border region to take advantage of the opportunities offered by the border economy and it had been an essential part of the internal political and economic relations. After the war this activity has considerably decreased or completely disappeared. The great increase of Hungarian, Slovakian and Czech tourism in the Adriatic has necessitated the construction of the Budapest-ZagrebRijeka/Split highway system. The completion of this highway is expected by 2007, and includes a new and modern crossing point on the River Drava. 165
However, most passengers who travel this route use it only as a thoroughfare, and do not stop in the vicinity of the border. The accession of Hungary to the EU in 2004 has not had a significant effect on the border area. However, Hungary is set to accede to the Schengen area in October 2007, making the Croatian-Hungarian border an external Schengen one for a few years. This will then change in turn when Croatia enters the Union, possibly at around 2009. Once Croatia becomes a full fledged Schengen state a few years later, the border will be an internal one, and will thus be completely eliminated. This means that by the end of the 2007-2013 programming period we can count with a completely border free transitory region along the Drava.
4.1.2 Demography and population dynamics Both sides of the border region are characterised by a slow net natural population decrease. This decrease is somewhat faster on the Hungarian side. Table 4.2: Population of the border region COUNTY Somogy Baranya Zala Total, Hungarian side Zagrebačka Varaždinska Koprivničkokriževačka Bjelovarskobilogorska Virovitičkopodravska Požeškoslavonska Brodskoposavska Osječkobaranjska Vukovarskosrijemska Meñimurska Total, Croatian side TOTAL, BORDER REGION
POPULATION (1991) 344 708 417 400 306 398
POPULATION ( 2001) 331802 400313 295197
BIRTHS
DEATHS
3038 3579 2309
4778 5083 3987
1027312
8926
13848
-4922
282989 187853
309696 184769
3010 1683
3551 2492
-541 -809
129397
124467
1104
1708
-604
144042
133084
1129
1958
-829
104625
93389
843
1273
-430
99334
85831
822
1006
-184
174988
176765
1683
2056
-373
367193
330506
2794
4030
-1236
231241
204768
1901
2249
-348
119886
118426
1249
1272
-23
1 841548
1761701
16218
21595
-5376
2789013
25144
35443
-10299
Source: Census of Population 1991, 2001, VÁTI 2006a 166
NET BIRTHS -1740 -1504 -1678
Migration to and from the region, including flows across the border, balances out and does not cause a significant distortion to the natural balance. The age structure of the border region is not very different from the national average on either side of the border. On the Croatian side there is even a somewhat higher proportion of young people than the national average. However, the demography of certain (rural) microregions within the eligible area is markedly different from the entire region. Statistical data of the region show that the proportion of people having tertiary education is significantly lower in the region than the national level on both sides. This problem is even more marked in rural microregions, especially along the border. Spatial distribution and dynamics The only major urban centres in the region are Pécs and Osijek. A number of other important urban centres play a role on a more local level. Pécs (with 155205 inhabitants), Kaposvár (67662), Zalaegerszeg (60061), Nagykanizsa (51694), Komló (27387) are the most important settlements. On the Croatian side the major towns are Osijek (114616), Velika Gorica (63517), Slavonski Brod (64612), Varaždin (49075), Bjelovar (41869). A large number of rural microregions are characterised by small settlements (Ormánság, Zselic, Hegyhát, many areas of Somogy). These areas demonstrate a low employment potential, an ageing population, a higher presence of the Gypsy (Roma) minority and a high propensity of outward migration. The bad state of the internal transport routes makes the accessibility of intraregional centres and main international thoroughfares very difficult. 96 settlements in Baranya and 74 in Somogy are cul-de-sac settlements.
4.2. Economy 4.2.1 GDP per capita Both sides of the border are poorer than the national average, but the disparities vary by county. Koprivničko-križevačka county has about the same GDP level as the Croatian average, and Meñimurska county is also more developed than the other Croatian non-borderline counties. In the Hungarian side of the border Zala county is similar to the national average in its GDP level, while Baranya and especially Somogy are considerably poorer. 167
Table 4.3: The GDP per head in the border regions County Zala Somogy Baranya Average Hungary Brodsko-posavska Vukovarsko-srijemska Požeško-slavonska Zagrebačka Virovitičko-podravska Osječko-baranjska Bjelovarsko-bilogorska Meñimurska Varaždinska Koprivničko-križevačka Average, Croatia
2001 (1000 €)
2002 (1000 €)
4929 3984 4196 5717 5246 4988 6351 5837 6875 6672 6752 7146 8178 8893 8597
5600 4372 4803 6462 5511 5373 6533 7151 7147 7396 7354 7749 8959 9585 9266
2003 (1000 €) 6568 4850 5309 7125 5620 5742 7051 7172 7356 7402 7451 7699 9037 9595 9684
Index 2003/ 2001 133.2 121.7 126.5 124.6 107.1 115.1 111 122.9 107 110.9 110.4 107.7 110.5 107.9 112.6
2003, % of country average 92.0 68.0 75.0 100.0 58.0 59.3 72.8 74.1 76.0 76.4 76.9 79.5 93.3 99.1 100.0
Source: Croatian Bureau of Statistics 2003, VÁTI 2006a.
4.2.2 Number of enterprises Table 4.4: The number of business enterprises in the border region County Zala Somogy Baranya TOTAL Brodsko-posavska Vukovarsko-srijemska Požesško-slavonska Zagrebačka Virovitičko-podravska Osječko-baranjska Bjelovarsko-bilogorska Meñimurska Varaždinska Koprivničko-križevačka TOTAL
Number of sole proprietors (H) / crafts (CRO) 15651 16763 18307 49721 10784 10640 4401 20491 4840 16576 3803 4047 10179 6020 91781
Number of partnerships, companies 13695 13072 20753 47520 1107 1069 721 4139 581 3126 1111 1787 2100 1080 16821
Number of employed in business sector 15290 15821 15993 29793 10535 43501 15513 22497 33692 18585 221220
Source: Croatian County Chambers of Commerce,2004; Chamber of Commerce 2005; Chamber of Crafts 2005; Census 2001; VÁTI, 2006a. Regarding the sectoral structure of the area in question it may be underlined, that there are underground natural gas and oil resources in the region, although no serious plans to explore and exploit these have been outlined. The agricultural sector on both sides of the border suffers from small farm sizes. 168
4.2.3 Labour market dynamics Unemployment, activity, employment The borderline counties in Hungary show nearly the least favourable unemployment statistics in the country according to the data of February 2006 provided by the County Labour Centres. In the period of JulySeptember 2006 the unemployment rates published by the Central Statistical Bureau of Hungary (KSH) show very high values for the area in question: Baranya (7.5 %) and Somogy (9.7 %) are the 5th and 6th worst counties in this respect. A more refined analysis reveals even greater problems. Microregions along the border register alarmingly high rates of unemployment: Sellye (34.7 %), Szigetvár (28.1 %), Szentlırinc and Siklós (20 %), Barcs and Csurgó (23 %).
Figure 4.2: Unemployment in the border region of Hungary Source: KSH,2006; VÁTI, 2006a. The counties on the Croatian side are hit by even higher rates of unemployment. The Croatian average unemployment rate is 17.1 %. Almost all counties in the eligible area have registered higher rates, some critically high. 169
Table 4.5: The unemployment in the border region County Baranya Zala Somogy TOTAL Hungarian eligible area HUNGARY Brodsko-posavska Vukovarsko-srijemska Pozesko-slavonska Zagrebacka Viroviticko-podravska Osjecko-baranjska Bjelovarsko-bilogorska Meñimurska Varazdinska Koprivnicko-križevacka TOTAL Croatian eligible area CROATIA
Number of unemployed 11544 6272 7805 25621 15911 19610 5458 13662 9822 32120 11922 7221 10721 8069 134516
% of unemployed 8.0 4.7 6.1 6.2 7.3 29.5 32.1 20.9 16.7 29.6 26.1 25.6 15.5 14.2 16.8 22.7 17.1
Source: KSH,2006; Croatian Bureau of Statistics, 2003.
4.2.4 Infrastructure and development possibilities Main extraregional thoroughways passing through the region The main thoroughfare passing at right angles through the region is the Budapest-Zagreb-Rijeka/Split highway system, constructed within a very short period of time. The completion of this main artery is set for 2007, and includes a new and modern crossing point on the River Drava. The Zagreb-Belgrade highway runs just south of the eligible border area, attracting traffic southwards on the Croatian side. The accessibility of the Hungarian part from Budapest will be greatly increased by the construction of the Budapest-Osijek-Sarajevo Trans-European corridor. The first part, a Budapest-Dunaújváros highway has already been completed. An express road connecting Dunaújváros with Pécs is set to be implemented in the first years of the 2007-2013 programming period. These extraregional developments will greatly enhance transport to and from this region vis-à-vis the national capitals, Zagreb and Budapest (possible Belgrade as well in the longer run). They will also facilitate communication with ports in the Adriatic. Transport links to the economic heart of Europe would also be crucial for this border region. Thus the construction of the Zagreb-Maribor and Nagykanizsa-Maribor highway sections would be of crucial importance for economic development in the area. 170
Figure 4.3: The area eligible for cross-border cooperation Source: VÁTI, 2006b. Main intraregional thoroughways The depreciated quality of the internal road system makes the accessibility of major intraregional centres and main international thoroughfares very difficult. 96 settlements in Baranya and 74 in Somogy are cul-de-sac settlements. The scarcity of international border crossings greatly hinders intraregional communication (average distance is 62 km in the Southern Hungarian Region, the lowest amongst Hungary’s borders). Main extraregional railways passing through the region Major international railway lines converge on the northern part of the border region. The Nagykanizsa-Murakeresztúr/Kotoriba-Čakovec line and the Kaposvár-Gyékényes/Gotalovo-Koprivnica lines both run in the North. The Northern line used to connect Hungary and Slovenia before the establishment of railway connections recently. The major metropolitan centre of Pécs is connected only towards the South on non-electrified lines. Main intraregional railways, planned developments The intraregional rail system in Hungary is undergoing a major renovation programme. Airports, river traffic
171
The airport in Sármellék (Zala) serves international destinations, both charter and low cost airlines. An airport at Pécs-Pogány opened up in March of 2006, serving the Pécs-Vienna route. There is also a regional airport in Osijek. The former American military base in Taszár has a concrete landing strip and a service building, but is currently without a function. River ports exist on the Drava, but the amount of river transport traffic is insignificant. This is partly due to lack of demand, partly due to a desire to preserve the natural heritage of the area. The River Danube has an international significance as a transport motorway, but it is currently underutilised due to problems of transfer capacity.
4.2.5 Environment Extent of natural reserve areas and areas with a lower protection status The border region is characterised by the fact that it runs along the River Drava. This valuable environmental treasure is protected within the framework of the Danube-Drava National Park, encompassing 49 thousand hectares. The ecosystem of the River Mura is also strongly connected to this water system. It is extremely valuable that natural protection already exists in areas of high environmental value. Commercial shipping on the River Drava is scarce, but the Danube is a major international waterway. In the eligible area on the Croatian side, there are a number of protected areas. The most important ones are: • • • • • •
Nature Park Medvednica Nature Park Papuk Nature Park Kopački Rit Special botanic reserve ðurñevači pijesci Ornithology reserves Kopački Rit and Podpanj Water landscapes along River Mura.
The establishment of the regional park along rivers of Mura and Drava is under way. After the formal establishment, Ministries of Environment in Hungary and Croatia will request special protection under UNESCO.
172
Nature conservation areas with national importance, Natura 2000 sites and Ramsar areas
Balaton-felvidéki
Balaton
İrségi
Kis-Balaton Boronka-melléki
Zselicség
Kelet-Mecsek
Duna-Dráva Duna-Dráva
Legend
Special area for conservation Special (bird) protection area Ramsar area National park Landscape protection district Nature protection area Dráva river Border Eligible area
Figure 4.4: Nature conservation areas, NATURA 2000 and Ramsar areas Source: VÁTI, 2006b. The edges of the eligible area are characterised by more sweat water ecosystems, Lake Balaton, the Smaller Balaton and the River Sava. However, these have very minor cross border significance.
4.2.6 The educational sector Higher education Pécs is the major higher educational centre on the Hungarian part of the region, serving not only the Southern Transdanubian labour market, but also beyond, on the national scale. The other important higher education institution in the region is the University of Kaposvár, with more than 5000 students and of increasing significance in Hungarian higher education. Osijek is the major educational centre on the Croatian side, with developing institutions in Križevci and Varaždin. The educational sector on both sides of the border region is inflexible, the educational institutions are extremely slow to respond to the demand of the local economy.
173
4.3 The rural and spatial development experiences of borderline counties and microregions in Hungary from the transition to the present
4.3.1
The institutionalisation of rural development in Hungary, its measures and the accession of Hungary to the EU
The typical tendency of the recent years has been the fact that the importance of rural development has grown in Hungary, similarly to the trends in the EU. In the European Union the rural development policy has been initiated within the framework of the agricultural and spatial development policies relatively late, only at the end of the 1980-ies. In Hungary the emergence of rural development policy after the 1989 transition was influenced by factors rather different from that of the EU, of which two have to be emphasised here: namely the relatively low level of development of Hungary in comparison to Western Europe, and the process towards the country’s accession to the EU. The rural areas of Hungary have gone through considerable change since the transition, regarding the ownership structure, the economy and the social situation of the country. As a result of the globalised market competition local communities have started to show the signs of crisis. Due to this, the outmigration of the rural population towards more developed regions, and regional centres have increased. Thus a basic challenge for rural development is to keep the rural population in their homeland, in the rural regions, by creating an attractive area of living with good working conditions based on the careful, integrated and sustainable utilisation if the local resources. Besides the economic potential the most important resource of rural development is the healthy, active and self-organising local community. Besides these negative processes, due partly to the accession of Hungary to the EU the Hungarian opinions about rural development have been changing. By the end of the 1990-ies rural development has become the second pillar of the Common Agricultural Policy, and this tendency seems to have strengthened, and which is aimed, besides the improvement of the competitiveness of agriculture, at the environmental, employment and social objectives and their integration, to restructure agriculture and improve the living conditions in rural regions. In rural areas besides improving the profitability of agriculture as the still most important sector of the economy, an emphasized task is to diversify the economy for providing alternative and/or additional income, living, and employment possibilities for the population, and to encourage the 174
development of enterprises. The improvement of the attractivity of the rural environment, by maintainging the healthy and pleasant countryside, and the maintenance of the natural and man-made, built, cultural values of the area, will provide the foundations for making the rural living conditions more attractive for not only the rural population, but also for tourism targeted at rural areas, as well as the commercial activities and services. The objective and at the same time, the sole tool of rural development is the integration of various branches of the economy, the coordination of development projects with each other, the cooperation between local municipalities and local entrepreneurs, and altogether the emergence of an active rural society capable of designing their own future (Zemankovics – Bacsi, 2003). The first rural development measures were introduced in Hungary in 1998, and during the following years fast progress was seen in the establishment of rural development institutions and programmes, on national, county and microregional levels, so the rural regions of Hungary have prepared themselves for receiving the support allocated to them from the EU rural development fundings. In Hungary the rural development support system consists of the following resources: •
Support financed by the EU - Direct payments for producers (resources coming in 25 % from EU, in 30 % national sources); - Market influencing measures (export subsidy, intervention).
•
Co-financed support (sources are partly from EU and partly from Hungary) - SAPARD, - Agricultural and Rural Development Operative Programme (ARDOP, Hungarian acronym: AVOP), - National Rural Development Plan (NRDP, Hungarian acronym: NVT); - Complementary national direct support (CNDS, Hungarian acronym: KNKT).
•
Support financed entirely from national resources
Between 2000 and 2003 the Rural Development target-oriented commitments (in Hungarian: vidékfejlesztési célelıirányzat, VFC) announced calls for applications, to facilitate the implementation of rural development projects defined in the microregional development programmes, and also as a practice for submitting proposals for the funding offered by the EU to its member states. The VFC included a LEADER-type pilot programme to prepare for the LEADER+ programme of the EU, and, at the same time, to implement rural development programmes utilising national funding. The SAPARD programme was aimed at preparing the Hungarian actors for the ARDOP system. SAPARD is a pre-accession programme for the 10 175
Central and Eastern European countries having accessed the EU in 2004 in the area of agriculture and rural development. Due to the delays in the establishment of the institutional system the SAPARD programme started much later than planned, that is, only in 2003 in Hungary. In spite of that, Hungary managed to utilise all the amounts made available for it by the EU. Due to the high level of interest, the altogether 65.5 billion HUF was spent on supported projects, higher than the originally planned amount, which was possible by reallocating the resources and use extra funding from the National Rural Development Plan (NRDP or in Hungarian, NVT). For the accession to the EU the programming documents for the period 2004-2006 were completed, including the document containing the rural development funding, that is, the Agricultural and Rural Development Operative Programme (ARDOP, or in Hungarian, AVOP), and the National Rural Development Plan (NRDP, or NVT) for the Guarantee Section of EAGGF. Naturally, the microregions had to review and update their programming documents to include new action plans it them. After the accession the implementation of the national rural development programmes for 2004-2006 started. Project proposals were submitted to the authorities for the ARDOP from May 2004. The programme had more than 100 billion HUF resources, and altogether 5000 proposals were submitted in a very short time. The allocated support budget became insufficient in a short time. The National Rural Development Plan provides additional funding besides the Agricultural and Rural Development Operative Programme by support forms which are considered new in comparison with the former Hungarian practice. Altogether more than 40 thousand proposals were submitted to the various target areas of the programme, which shows the great interest and positive approach of the rural communities. Naturally, besides the above systems several other support schemes exist in Hungary which are directly or indirectly aimed at rural development. These were the following: „Decentralised” funds: • Spatial development target-oriented commitments (TFC) • Territorial compensatory subsidy (TEKI) • Target-oriented decentralised support (CÉDE) • Regional target-oriented commitments and action plans Central support schemes: • Pre-allocated and target-oriented support (CCT) • Széchenyi-Plan: • Target oriented commitment for Economic development (GFC) • Target-oriented decentralised commitment for tourism (TURC) • Labour market fund (MPA) • Agricultural supports (AGR) • Environmental conservation fund targets (KAC) • Road maintenance and development target (ÚTC) 176
• Water Management target-oriented commitment (VÍCE, later united with KAC it became KÖVICE, then operated under the name of Green Spring) PHARE CBC and PHARE mirror programmes ISPA programmes INTERREG III/A, B, C programmes Other EU-funded action plans (e.g. LIFE programme)
The agricultural and rural development programme for 2007-2013. has already been outlined and its directions are based on the National Development Conception and the 2nd National Development Plan. The specific feature of the planning of the agricultural and rural development strategy two things have to be kept in mind at the same time, namely the requirements of the national economic policy and at the same time the requirements of CAP, the Common Agricultural Policy, or more precisely to maintain this during the extensive reforms of the area. The implementation of the AVOP, the national rural development plan takes place within the CAP, or following its reform, the new unified European Agricultural and Rural Development Fund. The agricultural and rural development priorities for 2007-2013 are: the improvement of the competitiveness of agriculture and forestry, the protection of the environment, the maintenance of the productivity of land, environmentally sustainable farming, diversification of the rural economies, the improvement of the quality of life for rural inhabitants, the diversification of the non-urban economies, and the implementation of local initiatives.
4.3.2 Rural development experiences in the south-western borderline counties 4.3.2.1 Rural society and economy in Baranya, Somogy and Zala counties According to the Alföld Scientific Institute of the Regional Research Centre of the Hungarian Academy of Sciences the above three counties have rural settlement structures and rural economies (see the following two maps). Except for the county – level large towns and the areas around Keszthely and Siófok by the lake Balaton the settlement stuctures of the three counties, and especially the microregions located by the Croatian border are characterised by typically small towns and tiny villages. Thus the importance of agricultural and rural development is higher in these areas than in more industrial and more centrally located areas and microregions. 177
Figure 4.5: Microregions in Hungary Source: Csatári (1999). Notation: rural microregion: less than 50 % of the population lives in settlements with population density at least 120 persons/km2, extremely rural microregion: none of the population lives in settlements with population density over 120 persons/km2
Somogy county 178
Somogy is the fifth largest county of Hungary. It is one of the least urbanised ones, only 49,1 % of the population lives in towns. These towns are, with the exception of the centre of the county, Kaposvár, are all small towns, their territorial distribution is uneven, and their location is peripheral. Settlement structure is mainly characterised by micro-villages, most of them have less than 1000 inhabitants. Similar to the former years, and to the overall pattern of Hungary, the natural decrease of the population has been a constant tendency. The proportion of the elderly inhabitants in the population has been continuously growing, the ageing index has increased from 84.7 % in 2000 to 98.3 % in 2004. Considering human resources, the position of Somogy is weaker than the average of the region, and also of Hungary. Somogy is a markedly agricultural region. The performance of agriculture has decreased to the two thirds of the time before 1990. Within this the formerly equally important two main activities, animal husbandry and crop production, animal husbandry decreased to half of its former performance. The changed structure of the decreased production does not fit to the resources of the county and do not rely on the livestock husbandry traditions of the county. The area covered by forests is higher than the country average, which is 22 % of the agricultural area for the whole of Hungary, while it is 32.9 % for county Somogy. Baranya county The settlement structure of Baranya is typically characterised by very small villages, the two thirds of the settlements have less that 500 inhabitants. This disadvantage is aggravated by the scarce road network, and the resulting difficult accessibility, many of these villages lie at the end off culde-sac roads. The economy of Baranya county shows the signs of underdevelopment, the increasing development gaps from the central territories of Hungary. Approximately 5 % of the businesses work in the field of agriculture and forestry, 22 % in manufacturing, 73 % in the tertiary sector. The development of the county depends on the future of Pécs. Baranya has excellent natural resources – climate, relief, good farmlands – provide very favourable conditions for agriculture. The main arable crops – wheat, maize, sunflower, sugarbeet – have yields similar to the best yields of Hungary. Winegrapes and wine production is also remarkable, having longstanding traditions in the area. Zala county The settlement structure of the county is characterised by strikingly high proportions of micro and small villages. In 80 % of the settlements the population is less than 1000 persons. The lack of towns, providing services and town functions for the area is also a problem. While in the other two counties of Western Transdanubia the employment structure has been essentially determined by the international companies settled in the area, the impacts of this in Zala are only scarcely felt. The most important economic resources of county Zala are the thermal and 179
medicinal springs, in considerable quantities and these resources provide the basis for the tourism sector of the county. After the transition the greatest losers are the agricultural employees, because their numbers have decreased by 70 % in 11 years. The main arable crops are cereals, the largest arable lands are used for wheat, maize and barley. In the hillsides of Zala grassland and fruit production are among the most important activities. The largest contiguous pear orchard in Hungary is found in county Zala, and apple orchards are also extensive. The hillside by the lake Balaton is a famous wine producing area.
4.3.2.2 The results of SAPARD in the three counties In Zala county the number of project proposals submitted for SAPARD measures was altogether 521, the number of the supported projects was 131. The most popular measure was 1308 (Development of rural infrastructure), altogether 170 proposals were submitted to it, but only 49 received funding. Table 4.6: Received and supported SAPARD project proposals in county Zala Measure (county Zala) 111 Development of farm enterprises 114 Development of processing and marketing of farm and fishery products 1305 Village development and reconstruction, preservation of spiritual and material rural heritage 1306 Diversification of activities, development of activities providing alternative revenues 1308 Development of rural infrastructure County Zala, TOTAL
Received (number) 166
Required funding HUF 3 638 247
Supported (number) 65
Support HUF 1 645 678
20
759 174
7
328 792
146
2 734 585
7
123 003
19
172 299
3
34 529
170
3 585 811
49
1 193 011
521
10 890 115
131
3 325 013
Source: Authors’ own construction In Baranya county the number of project proposals submitted for SAPARD measures was altogether 466, a little less than in Zala. The number of the supported projects was 136, the most popular measure was 111 (Development of farm enterprises), altogether 193 proposals were submitted to it, but only 81 received funding.
180
Table 4.7: Received and supported SAPARD project proposals in county Baranya Measure (county Baranya) 111 Development of farm enterprises 114 Development of processing and marketing of farm and fishery products 1305 Village development and reconstruction, preservation of spiritual and material rural heritage 1306 Diversification of activities, development of activities providing alternative revenues 1308 Development of rural infrastructure County Baranya TOTAL
193
Required funding HUF 4 278 833
47
Received (number)
Supported (number)
Support HUF
81
1 616 768
2 059 406
16
603 822
125
2 216 562
7
221 212
26
116 801
5
23 425
75
1 965 981
27
795 191
10 637 582
466
136
3 260 419
Source: Authors’ own construction In Baranya county the number of roject proposals submitted for SAPARD measures was altogether 384. The number of the supported projects was 137, the most popular measure was also 111 (Development of farm enterprises), altogether 194 proposals were submitted to it, but only 90 received funding. Table 4.8: Received and supported SAPARD project proposals in county Somogy Measure (county Somogy)
111 Development of farm enterprises 114 Development of processing and marketing of farm and fishery products 1305 Village development and reconstruction, preservation of spiritual and material rural heritage 1306 Diversification of activities, development of activities providing alternative revenues 1308 Development of rural infrastructure County Somogy, TOTAL
Received (number 194 18 100
5
67 384
Required funding HUF 3 726 094
Supported (number) 90
1 715 838
989 457
8
305 817
1 888 243
4
31 287
17 230
4
13 369
1 374 246
31
589 403
7 995 269
Source: Authors’ own construction
181
137
Support HUF
2 655 715
4.3.2.3 The results of AVOP in the three counties (2004-2005) Data available at the end of 2005: -
-
Altogether 3114 projects received support within the framework of AVOP, of which 473 were from Zala, Somogy and Baranya. The largest support received was 500 million HUF, the smallest 15 000 HUF, (when 1 EUR = 250 HUF at the end of 2005) and the total support available was 82 551 million HUF. The total planned budget for the 3114 projects was 201 billion HUF, that is, to each HUF of support the applicants added 1.50 HUF of own resources to manage the objectives.
Table 4.9: The supported project proporsals in the framework of AVOP (ARDOP) Number Percent Cumulative Percent Zala 178 37.6 37.6 Somogy 136 28.8 66.4 Baranya 159 33.6 100.0 Total 473 100.0 Source: Authors’ own construction Table 4.10: The supported project proporsals in the framework of AVOP – distribution by organisation type Business type Number Percent Sole trader, small size entrepreneur 157 33.2 local municipalities, public bodies 54 11.4 company 207 43.8 cooperative 13 2.7 other 42 8.9 Total 473 100.0 Source: Authors’ own construction Table 4.11: The supported project proporsals in the framework of AVOP – distribution by the measures Categories of measures, Number of Percent Cumulative code applicants Percent 11 344 72.7 72.7 13 2 0.4 73.2 14 8 1.7 74.8 15 1 0.2 75.1 21 15 3.2 78.2 31 16 3.4 81.6 32 31 6.6 88.2 34 47 9.9 98.1 35 8 1.7 99.8 Technical assistance 1 0.2 100.0 Total 473 100,0 Source: Authors’ own construction 182
Table 4.12: The supported project proposals in the framework of AVOP by counties Weighted proportion County number % (weights: amount of support received) Bács-Kiskun 278 8.9 9.5 Baranya 159 5.1 5.8 Békés 179 5.7 5.4 Borsod-Abaúj-Zemplén 262 8.4 7.8 Budapest 28 0.9 1.7 Csongrád 174 5.6 5.6 Fejér 146 4.7 4.5 Gyır-Moson-Sopron 151 4.8 4.9 Hajdú-Bihar 271 8.7 8.4 Heves 120 3.9 3.8 Jász-Nagykun-Szolnok 175 5.6 5.5 Komárom-Esztergom 42 1.3 1,5 Nógrád 37 1.2 1.0 Pest 131 4.2 5.2 Somogy 136 4.4 4.0 Szabolcs-Szatmár-Bereg 303 9.7 10.0 Tolna 149 4.8 4.9 Vas 128 4.1 3.8 Veszprém 67 2.2 2.1 Zala 178 5.7 4.6 Total 3114 100.0 100.0 Source: Authors’ own construction The above tables show that the assessed three counties are in the middle of the ranking order of Hungarian counties:
Zala had the highest numbers of successful project proposals, 178, which is 5.7 % of all the successful project proposals. The projects in Zala are typically smaller in size, and this explains why the allocated funding is only 4.6 % of the total support given to the successful project applications. Somogy was the weakest of the three assessed Western Transdanubian counties (with 136 successful proposals), altogether 4.4 % of the successful projects came from here, and 4.0 % of the allocated funding was given to these projects. Baranya was the second of the assessed three counties with 159 successful applications, the proposals are generally of large or medium-size, and this explains that 5.8 % of the total support was given to Baranya.
The analysis of the amounts of funding received show that in county Baranya the above average projects, in county Somogy the below-average 183
ones, while in Zala the near-average projects were the largest proportion of the funded projects. The majority of the applicants of the successful projects were business companies, their proportion is nearly 40 %. Their proportion is remarkably high in Baranya (54.1 %) and their proportion in Somogy (46.3 %) is also higher than the Hungarian average. In Zala the largest group of the successful applicants is typically sole traders and small scale farmers (37.1%), and the proportion of business companies is only 32.6 % here. The proportion of sole traders and individual small farmers was especially low among successful applicants in Baranya (27.7 %), while their proportion in Somogy is similar to the Hungarian average (34.6 %). Local municipalities, public authorities, that is, the actors of the public sector submitted 10.2 % of the successful proposals in Hungary on average, but their proportion is remarkably high in Zala (18.5 %), while in the other two assessed counties this proportion is below 10 %. The distribution of the successful applications by support measure shows that the agricultural investments make 74.6 % of all the successful projects. In Somogy the proportion of projects supported under measure 111 (Development of farm enterprises) is somewhat higher than the national average (79.4 %), while it is lower than average for Zala (64.6 %). Baranya shows similar proportion to the country average. Among the measures of lower application numbers it is worth pointing out the development of agricultural infrastructure, and the village development measures, because in these the applicants from Zala were particularly successful. This is due to the fact, that a considerable proportion of the local municipalities, local governments of county Zala applied for these measures for road construction and reconstruction of public places, squares. The sole traders, individual small scale farmer received support for smaller size projects, applying for smaller funding, while the business companies, partnerships received the largest support amounts. In Zala the situation slightly differs from the national average, because some municipalities applying for infrastructural developments received rather high support amounts. Somogy is similar to the Hungarian average, while Baranya has remarkably high supports for the projects submitted by business companies.
4.3.3 Rural development achievements in the microregions of Barcs, Siklós and Keszthely-Hévíz In assessing the rural development achievements of the borderline territory special attention was paid to three sample regions selected by objective aspects. These sample regions are in counties Zala, Somogy and Baranya respectively, so that they cover the whole area of the project. The Barcs microregion is the most important unit of assessment because it is located in the immediate neighbourhood of the Croatian borderline areas. 184
The experiences gained during the assessment of the microregion indicate that the microregion is considered very underdeveloped both in comparison with the rest of the county and also with the rest of Hungary, and its activities in preparing project proposals is low, and it has hardly done any work in the field of rural development (e.g. the implementation of LEADER type projects). In spite of that the microregion can be a good example for the Croatian borderline counties, because of its nearness, and social and economic similarities. The Siklós microregion is also located in the vicinity of the border, but opposite to the formerly described microregion it is a successful and well known microregion even in comparison with the Hungarian average. Assessing its experiences the secret of its success may be identified, and it may be useful for the development of borderline regions. The microregion is very active in preparing and submitting project proposals, which may be due to the wide cooperation and joint action of the rural development actors as well as the probably successful leadership of the microregion. The microregion has implemented many successful and efficient economic and rural development projects which have lead to considerable improvements in the income generating capability of the microregion and in the living standards of the local inhabitants in the recent decades. The Keszthely-Hévíz microregion, which is the centre of the present Interreg project, is about halfway between the two microregions described above regarding its activity in preparing projects and implementing rural development programmes. Its assessment is important because of its specific touristic resources (lake Balaton, thermal spas), because such resources may be assets for development for the Croatian borderline regions, too. Besides, interesting consequences may be identified from the relationships of the small villages located directly by the shores of lake Balaton and the rather rural villages situated farther away from the lake, as well as from the contrasts between urban and rural areas.
4.3.3.1 Rural development programmes implemented in the Barcs microregion Assessment of projects funded from the Rural development target-oriented commitment (VFC) in Barcs microregion During the 4 year-operation of the VFC project fund system altogether 2 projects have received support of this fund in the microregion in the 20012002 period, the subsidy was less than 9.5 million HUF. For the sake of comparison, in the Siklós microregion in the same period 38 projects received funding and the total subsidy was 170 million HUF. This very low level of acticity in project applications shows that at the beginning the rural development assistance network of advisors initiated by the Ministry of Agriculture and rural development had not been established in the microregion, and there were no agencies, offices and private 185
consultants specialised in project preparation either. The other reason for the failure was the lack of experience of the eligible organisations, the lack of information and the lack of motivation. This lack of experience was also seen in the refusal of SAPARD projects. Successful SAPARD project proposals in the Barcs microregion In the Barcs microregion strikingly few project proposals were submitted by the eligible organisations, and these proposals were all of very bad quality. Of the 22 submitted proposals only 7 (31.8 %) was approved, and only 5 (22.7 %) implemented in the microregion. In the case of the 2 other supported projects the applicant refused to sign the contract and refused the funding. 3 of the 5 successful and implemented projects was submitted and implemented by DRÁVA-COOP Rt., so the largest proportion of the total support was concentrated here (82.7 million HUF). The funding was used for machinery investment, the construction of a straw storehouse and the building of a social house. The only one of the successful projects, that may be considered a rural development project is the one submitted by the Babócsa municipality for establishing a Telehouse. The success of the AVOP (ARDOP) applications in the microregion In the Barcs microregion in the analysed period altogether 22 project proposals were submitted, 11 of them, that is, exactly 50 % received funding. The successful projects won altogether 400 million HUF for developments in the microregion. 6 of the successful projects were submitted by micro-enterprises, 4 by medium-size enterprises and 1 by an individual. Considering the support money the medium size enterprises were the ones receiving the greatest proportion of the total. It may also be stated that the geographical locations of the successful projects are rather disperse in the microregion, 7 settlements received some kind of funding by the projects, and only 3 of the successful projects were implemented in the microregional centre, Barcs.
4.3.3.2 Rural development programmes implemented in the Siklós microregion The assessment of the VFC (rural development target-oriented commitments) application system in the microregion The VFC programme of the Ministry of Agriculture and Rural Development initiated in 2000 facilitated the implementation of a very wide range of development ideas, and for this reason it became very popular for the applicants in the microregion. At first the applicants were mainly entrepreneurs, but from the year 2002 municipalities and civilian (nonprofit) organisations also started to submit applications. In the 2000-2001 period the applicants submitted proposals only for the establishment or enlargement of accommodation for rural tourism, and only 186
from the central settlements of the Villány-Siklós wine path (Villány, Villánykövesd, Nagyharsány). In 2002 some of the applications were about investments for agricultural production (beekeeping, fruit and winegrape processing, agricultural machinery), as well as the development of infrastructure needed for agricultural production (repairs or construction of agricultural roads, establishment of electric power lines) and other special objectives – e.g. installation of meteorological measurement station. The development of rural tourism services has remained an important objective (enlargement of the rural accommodation capacities, installation of all conveniences, initiation of other services, together with touristic developments serving also community objectives. In 2003 only some members of the Villány-Siklós wine path applied for the „open house” project. The Siklós microregion is the most successful one of the assessed three microregions. The number of submitted applications and the proportion of the successful ones is remarkably high, which is explained by several factors, of which the most important one is probably the remarkable activity or civilian organisations, and the high level of cooperation among the possible partners, which is clearly shown by the high numbers of applications. Within the 4 years of the VFC application system altogether 38 successful projects were supported in the microregion, of the total support of 170 million HUF. In the year 2000 7 projects received funding of 18.3 million HUF, and in 2001-2002 another 30 projects were subsidised by 150.0 million HUF, and then in 2003 one project was successful with only 0.5 million HUF funding. The majority of the successful project applications was related to the development of the Villány-Siklós Wine Path, spending the funding on development of accommodation, wine cellars, and marketing activities. 6 of the projects were implemented in Siklós, 14 in Villány (that is, more than half, exactly 52.6 % of all projects) so only a limited amount of support remained available for the rest of the microregion, the remote villages away from the two central towns. Surprisingly, however, 27 % of the total subsidies were spent in Palkonya, which is remarkable for a small village. SAPARD projects in the Siklós microregion The microregion is also successful with regard to SAPARD projects, altogether 85 proposals were submitted, of which 19 projects received support of altogether 620 million HUF. The spatial distribution of the projects is rather varied, the two towns have only 3 - 3 successful proposals each, the rest of the projects takes place in villages. The largest subsidy was received by the Bóly Agricultural Production and Trade Corporation, one project received 150 million HUF for modernising the technology of husbandry. The second largest support was 80 million HUF given to Harkány Town municipality for the construction of an agricultural road. A large proportion of the projects, 11 of them was aimed at machinery purchase, and 4 of them at the development of agricultural roads. Another characteristic feature is that many of the applications was related to wine production. 187
The ARDOP (AVOP) projects in the microregion The microregion is also very successful in the ARDOP project application process, too. The Siklós microregion submitted 80 proposals, of which 40 (that is, 50 %) received funding, of which 9 applicants rejected the support. Altogether 31 projects have been implemented for altogether 1902 million HUF subsidy. Considering the spatial distribution the proposals are uneven, and the villages achieved much better results than the towns. From the town of Villány altogether 24 project proposals were submitted, of which 7 were approved, out of these 4 applicants withdrew their projects and only 3 were implemented. From Siklós only two proposals were submitted of which 2 received support. In the village Nagyharsány 7 proposals were submitted, 5 were approved, 2 withdrawn. In Kisharsány out of the 8 submitted proposals, 6 were supported and 1 of them withdrawn. This means that the smaller settlements, villages have been more successful in this programme. Successful applications were submitted by four other settlements, Túrony and Babarcszılıs (in both settlements all of the submitted proposals were approved), and Gordisa and Kisjakabfa. It is an interesting fact, that Palkonya, which had been very successful in the SAPARD system was not successful with any of its 4 submitted project proposals. Harkány and Villánykövesd (with 3-3 submitted proposals each) have not received any support either. This may perhaps be explained by the fact, that the application system of AVOP is not exactly the same as of SAPARD, and it might have caused problems to the otherwise experienced applicant. Moreover, there were overlays in time, which also made it difficult to prepare successful projects for both systems. It is also surprising to see that the settlements received support in much larger proportions than it might have been expected by the number of submitted proposals. For example, in Nagyharsány the proportion of successful applications is 9 %, while the funding received in 19.1 % of the total support paid. These settlements are really successful regarding project applications although the project proposals are typically connected to a relatively narrow entrepreneurial circle. Other projects and developments in the area During the last five years considerable changes have been taking place in the area of the microregion. Considering the various economic activities several remarkable achievements may be mentioned. The following section describes these development activities. In arable farming a loose, but efficient cooperation was established in production and trade. This integration was created in the southern part of the microregion. The integration is characterised by the fact, that besides utilising comparative advantages the economic units keep their independence while cooperating in the integration. They have common extension agents and consultants in the fields of production, accounting, finance, trade and marketing, and in preparing project proposals, etc. The farm businesses and the sole farm entrepreneurs will have to establish the 188
locally specialised forms of horizontal and vertical integration both in production and in trade relations. Last year the largest development project was carried out in the area of winegrapes and wine production, by the winegrape processing and wine production unit built at Villány for several hundred million HUF. However, no other great developments have occurred in the agricultural sector. The new integration in arable farming and the winegrape and wine production invesment have had considerable impact on the employment situation by creating new jobs, and also improved the level of processing of farm products and decreased the environmental load of farming. In the municipal (public) sector the specific subsidies of CÉDE (Target oriented decentralised support) and TEKI (Territorial compensatory subsidy) offered by the Spatial Development Council of Baranya County were the largest external resources for development. Both funds offer relatively small amounts for the settlements. The total support to distribute was about 60 to 70 million HUF per year. In assessing the submitted proposals the principle of solidarity was considered and all of the settlements of the area received some funding to implement some of its smaller investment plans. The submitted and the approved projects show a specific division by theme. From the CÉDE fund about 20 settlements received support each year. Most of them were spent on reconstruction of buildings owned by the municipality, but there were supported projects for the construction or reconstruction of public roads and pavements in settlements. Among the buildings reconstructed there were the buildings of the local government, buildings of educational or health care or social functions, too. Most of the reconstruction activities were carried out in buildings which, otherwise, would have become certainly ruinous. Besides the above mentioned investments of maintenance and functional character – only a few of the submitted proposals described investments of a really developmental character. Examples of this may be the Dísz-lake in Szalánta, and the Youth Sports Centre in Kiskassa. Due to the relevant regulations and the needs of the possible calls for proposals by the municipalities more support was allocated to the settlements for spatial organisations and modernising their local regulations for issuing building and construction permissions. Similar approach was seen at the settlements about the utilisation of TEKI resources. In the past years annually 8 to 27 settlements received funding for submitted proposals. Again the resources was spread „relatively evenly” in the area. Most of the settlements required funding for the creation or the updating of its spatial organisation and development plan. A similarly urgent task was the treatment of sewage and precipitation drainage problems. Another important topic was the problem of the location of municipal institutions and the related renovation of municipal buildings. TEKI funds were also allocated to a novel development, namely the establishment of lake no II in Kistapolca. In 2003 two municipalities submitted proposals from the microregion to the PHARE – „Encouraging integrated local development actions” programme. The town Siklós gained funding for its project „Mediterranean southern 189
gateway”, which was aimed at constructing a modern town marketplace and a pleasant pedestrian street in the centre of the town for a total support of 400 million HUF. The project will have great impacts on the tourism of the microregion. Other resources assisting the development of the microregion: -
-
Spatial development target-oriented commitment, Settlement and regional development target-oriented commitment – encouraging job protection and job creation investments Microregional Assistance Fund – for supporting the development projects of disadvantaged microregions Project funds of the Ministry of Economy and Transport Green Resource Fund for the environmental conservation projects of small settlements Regional Tourism Fund Fund of the Ministry of Information and Communication Technology: telehouse, e-Hungary programme Ministry of Youth and Sports – Mobilitas Fund European Social Fund – informations technology in primary schools Public work funds for unemployed persons.
4.3.3.3 Rural development programmes implemented in the Keszthely-Hévíz microregion The impacts of the projects funded from the Rural development target-oriented commitment (VFC) in the microregion The project preparing activity of the Keszthely-Hévíz microregion for the VFC funds is not really successful, during the four years of the fund altogether 8 projects were approved and funded. In 2000 only one, in 2001-2002 6 projects, and in 2003 only one again. The low number of the successful project proposals may be explained by the fact, that the rural development advisory network has been evolving very slowly, with several changes of the persons involved, and in the recent years the current statistical microregions used to be divided to several smaller, often overlaying functional microregions, which had rather limited financial resources to participate efficiently in the project preparation activities. The supported projects received altogether less than 74 million HUF in the microregion, and the largest amounts of subsidies were allocated to Vindornyalak and Zalaszántó, where the reconstruction of the mansions of the Hertelendy and the Petı families were carried out with new activities established in them. Another topic of the submitted applications was the wine production and wine marketing activities and the modernisation of agricultural production. 190
SAPARD proposals in the Keszthely-Hévíz microregions The project preparation activity of the Keszthely-Hévíz microregion is very successful within the framework of the SAPARD programme, because altogether 21 projects received funding of altogether 681.5 million HUF, which facilitated the establishment of investments of 1164 million HUF total value. The most popular measure of the programme was no. 1308 (The development and improvement of rural infastructures), because half of the projects were aimed at that. Besides, 4 projects focused at the purchase of agricultural machinery, 3 for the development of agricultural buildings, and 2-2 for the other investments of agricultural buildings, and for the deveopment of processing and marketing of agricultural and fishery products. Many of the projects were focused at the development of agricultural roads, and for the reconstruction and technological modernisation of agricultural buildings. Special attention should be given to the idea of utilising solar energy as an alternative energy source, which was mentioned in two project proposals. 9 of the proposals were submitted by municipal institutions, 2 by civilian non-profit organisations, 4 by individuals (sole traders) and 6 by business companies. It is interesting to note that the largest amount of support was given to a small settlement, Zalaapáti. The settlement received support for 3 projects of altogether 140 million HUF worth of development. Besides, extensive amounts of funding were given to Sármellék, Keszthely, Balatongyörök, and Szentgyörgyvár, too. The assessment of ARDOP (AVOP) projects The microregion has had 16 successful AVOP projects in the recent years, and this brought altogether 317 million HUF support into the region. The most successful settlement was Esztergályhorváti village with 4 winner projects receiving 173.8 million HUF subsidy. The villages Dióskál and Felsıpáhok also received support for several projects. Similarly to SAPARD, again the topics of creating agricultural roads was the most popular objective, but the reconstruction of buildings and the purchase of machinery are also among the popular targets. Other projects The most important project fund in the microregion is the support system of the Balaton Development Council, because this fund is specifically aimed at the needs and interests of the settlements and applicants in the Balaton Region. During the last years 33 projects have been funded by the above regional fund, bringing altogether 114.2 million HUF into the microregion. The entrepreneurs of the region utilised the possibilities of the Economic Competitiveness Operative Programme (GVOP) very efficiently, because altogether 25 applicants received 259 million HUF support from this resource. Within the HEFOP (Human Resource Development Operative Programme) 2 projects received support of 11.8 million HUF, and another project reveived 30 million HUF from another fund of Ministry of Information and 191
Communication Technology (IHM ITPV). Besides, Hévíz reveived 130.4 million HUF support within the framework of the Environmental Operative programme (KIOP). Within the framework of PHARE 2 projects received funding of altogether 59.5 million HUF, while an INTERREG project was also approved for support. The largest impact has been made by the Regional Operative Programme (ROP), which allocated 835.8 million HUF to the microregions for 3 projects, of which the Festetics Palace Museum public non-profit association might be mentioned about its project focused on the development and presentation of the Festetics heritage, the establishment of a hunting museum and an exhibition about the history of railways.
4.4 Rural and spatial development institutions in the Croatian borderline, historical development from the transition to the present 4.4.1 Rural development and the SAPARD in Croatia
4.4.1.1 Description of rural areas The Organisation for Economic Cooperation and Development (OECD) and the EU (EUROSTAT) determine a rural area on the basis of population density. In defining rural areas OECD applies the threshold of 150 inhabitants/km², while the EU has the threshold of 100 inhabitants/km². Rural areas in the Republic of Croatia are analysed in this text through comparison of both criteria. At the level of individual EU member states, there is no common definition. Additionally, in some EU member states definitions of rural areas are based on socio-economic criteria (e.g. agricultural patterns, density of population or population decline) which are quite heterogeneous and not universally applicable. In Croatia there is no official definition of rural areas, and usually is accepted that rural areas are all areas outside the urban areas. Rural areas are determined by three major characteristics: population density, use of land and identity of community. Typical rural areas have low population density and small settlements. The greater part of available land is used for agriculture and forestry. Table 4.13: Surface of the rural and urban area OECD criterion EU criterion 2 Number of Km % Km2 % settlements Rural area 51872 91.6 47895 84.6 Urban area 4731 8.4 8708 15.4 Total 56603 100.0 56603 100.0 Source: Census, households and dwellings as on 31 March 2001 192
The sample of population density shows a concentration of population in a smaller number of urban settlements. Fourteen cities numbering over 30000 inhabitants have as much as 35 % of the population, meaning that nearly every third inhabitant in Croatia lives in such a population centre. Rural areas are characterised by a markedly low population density – as low as 34 inhabitants per sq. km, whereas the average population density in urban areas amounts to 325 inhabitants/km2 (according to the EU criterion). Table 4.14: The number of settlements in rural and urban areas OECD criterion EU criterion Number of Settlements % Settlements % settlements (number) (number) Rural area 6001 88,7 5318 78,6 Urban area 763 11,3 1446 21,4 Total 6764 100,0 6764 100,0 Source: Census, households and dwellings as on 31 March 2001 Within the SAPARD 2005-2006 Plan for agricultural and rural development the whole area of the Republic of Croatia will be financed, as specified in details for each measure further in this document. Rural population According to the 2001 census the Republic of Croatia has 4,437,460 inhabitants, of whom 18.3 % are below the age of 14 years, 66.1 % are between 15 and 64 years and 15.6 % are older than 65. Average age is 38.9 years; for the female population 40.7 and for the male population 37.1 years. Over the latest census period (1991-2001) demographic changes in the Croatian villages were markedly influenced by destabilizing (external) factors, such as the fact of aggression and war having caused enormous material damage, the loss of many human lives and social disturbances, as well as post-war and transitional difficulties in all spheres of economic and social life. These aggravated the demographic status of the Croatian villages as it had been over the previous thirty years and more, by exposure to a marked exodus of mostly younger and more vital population elements and the process of depopulation. Table 4.15: Rural population in the Republic of Croatia (1991-2001) Population
1991 number
%
2187060
45.7
Administrative criterion number % 1971005
44.4
OECD criterion
EU criterion
number
%
number
%
2112085
47.6
1608910
36.3
Rural area 54.3 2466455 55.6 2325375 52.4 2828550 Urban 2597205 area 4784265 100.0 100.0 6764 100.0 6764 Total Source: Central Bureau of Statistics, Census, 1991 and 2001.
193
63.7 100.0
The rural population has decreased in absolute and relative terms. In early 1991 rural settlements numbered 2187000 people, which accounted for 45.7 % of Croatia's total population; whereas the 2001 Census shows that their number has dropped to 1971000, i.e. 44.4 % of the total population. According to the OECD criterion the percentage would be 47.6 % and according to the EU criterion 36.8 % of rural population. In the period between the two Censuses the trend of demographic decline of the rural population continued. The data show a markedly unfavourable relation between young and old rural population and a distinct polarisation of demographic development between the rural and urban population. The age index of the rural population increased in this period from 0.79 to 0.96. An ageing population will have further impact on the reproducibility (a reduced birth rate and impaired reproduction of rural communities) and on the viability (a drop in the overall rate of economic activity) of the rural as well as of the overall population of Croatia. Sources of income of rural population An analysis of statistical data shows that the income situation of families and households living in rural areas is much worse than in urban areas. •
• •
In the rural areas, people without any income constitute the largest group of the population, i.e. 37 % of the total population living in those areas. In urban regions the largest groups of population are those for whom the work income is the main source of subsistence (38 %). The percentage of people for whom the income from work is the main source of income is much lower for those living in rural areas (29 %) than for urban regions (37 %); The percentage of those for whom unemployment benefit is the main source of income is in the rural areas twice as high as in urban regions; Some additional information regarding the income situation of the population living in rural areas can be provided by comparing the respective shares of supported population in particular regions. In the majority of counties the share of supported population which lives in rural areas (in the majority of counties between 31-36 %) appears to be considerably higher than for those who live in urban regions (27-32 % respectively). Furthermore, the respective share of females in the supported population is higher in rural areas (approx. 62-63 %) than in urban regions (55-57 %).
4.4.1.2 Disparity analysis In Croatia regional disparities in development are still increasing, a fact which is influenced by various elements. The level of regional development and regional competitiveness can be measured by many indicators, and with regard to a few extracted indicators the disparities mentioned are very notable. 194
Regional disparity
•
•
•
•
The largest share in total GDP belongs to the city of Zagreb (27.5%) and then follows Primorje-Gorski Kotar county (9.0 %). The City of Zagreb's GDP is already on the level of the developed EU member states, such as for example Greece, whilst in the poorest county, Lika – Senj, GDP by comparison with the capital is approximately 14 times lower. The City of Zagreb’s GDP per capita is three times greater than the Croatian average, or six times greater if the rest of Croatia is counted without the City of Zagreb. Therefore GDP in the city of Zagreb has risen to 19125 USD per capita, whilst the Croatian average is 6484 USD. If the city of Zagreb is excluded, than the average is much lower – 3345 USD per capita. Only two counties so far have a GDP per capita above the Croatian average Zagreb and Istria, whilst 14 of the total of 21 counties have a GDP lower than 4000 USD. Although GDP per capita on state level has increased from 5056 to 6484 USD, some counties record a decrease of GDP per capita, so in Sisak-Moslavina county a decline was recorded from 1583 to 1045 USD, in Vukovar-Srijem from 1606 to 1496 USD, and in Lika- Senj from 1,462 to 1,350 USD per capita. Unemployment rate is also very diverse – from 13 % in Krapina-Zagorje to 31 % in Šibenik-Knin. Unemployment rates of 25 % and higher are recorded in Vukovar-Srijem, Zadar, Brod-Posavina, Split-Dalmatia and Sisak-Moslavina counties. A particularly high relative increase in the number of unemployed persons was recorded in Virovitica-Podravina (27.3 %) and Sisak-Moslavina (29.1 %) counties. In the three-year period (31 December 1999-2002), a decrease in the number of unemployed persons was achieved in Istria and Primorje-Gorski Kotar counties (a decrease of more than 10 %). A further important indicator of regional development – the education rate - confirms a similar situation. The most favourable educational structure exists in the city of Zagreb with 16.6 % of highly educated persons in the population over 15 years old, then Primorje-Gorski Kotar with 9.8 %, Split-Dalmatia with 8.4 %, and Dubrovnik-Neretva with 8.1 %. In the other counties the recorded values were below average, Krapina-Zagorje county being at the very end of the scale with 3.2 % of highly educated persons. The City of Zagreb and Istria county have the biggest shares in Croatian exports, the highest employment and the lowest unemployment rates, therefore by analysed indicators these two counties are the most developed in Croatia. On the other hand, many counties which have lower employment and higher unemployment rates than the Croatian average are faced with very deep structural problems. From the analysed indicators it is obvious that big differences exist in the development of counties and their contribution to the overall Croatian indicators. Unequal regional development on one side keeps back certain regions from further development, and on another side has a negative impact on competitiveness.
195
Rural-urban disparities in the economy Analysis of data characterising the structure of rural economies indicates the following patterns: •
•
•
•
•
•
The high importance of the non-agricultural sectors in the regional economy and a relatively low significance of agriculture compared with other branches of the economy. In all regions, independent on the degree of rurality, the contribution of the agricultural, hunting and forestry sectors to total revenue generated in a given region in the year 2001 varied between 2-7 % only. The smallest contribution of the agricultural sector to the total regional revenue was found in the predominantly urban region (approximately 2 %). In the extreme rural areas the appropriate share was around 4 % only. On the other hand the manufacturing sector, together with the whole sale and retail trade and repair sectors, contributed on average to as much as 63-70 % of total regional revenues. The relative importance of the two above sectors was even higher in the “extreme” rural areas where they accounted for more than 75 % of total revenues generated in the rural economy. Due to underdevelopment of other sectors in rural parts of the country, the relative significance of the manufacturing sector was much greater for extreme rural areas compared with urban areas (47 % and 31 % respectively). In terms of employment, agriculture contributed on average 10.76 % of total employment in all the regions. Interestingly, in the extreme rural areas the manufacturing sector contributed to as much as 34 % of total employment, whereas in urban regions its relative contribution was much lower (approximately 27 %). On the other hand, the respective shares of employment in the health and social sectors, education and other public administration were much higher in extreme rural areas compared with urban regions. As regards the number of legal entities in each category of regions, the available statistics show that the great majority of these entities were active in trade and repair sectors (this applies to both urban and extreme rural areas). Yet there was a much lower percentage of legal entities which operated in the trade and repair sectors in extreme rural areas (36%) compared with urban areas (47 %). The much higher proportion of firms operating in public administration, education and health and social services in extreme rural areas compared with urban areas shows the relatively low importance of other productive sectors in the economy of rural regions (i.e. the number of legal entities operating in typical service sectors, e.g. transport, storage and communication sectors, financial intermediation and real estate sectors in relation to the total number of legal entities registered was much lower in extreme rural areas than in urban regions). Regarding fixed capital formation, the pattern of investment in extreme rural regions was quite different from those in rural regions. Indeed, a much lower proportion of investment was directed in 2000 in rural regions to service providers, e.g. transport, storage and communication, wholesale and retail trade, financial intermediation and other public 196
administration and much more to infrastructure (electricity, gas and water supply), the construction sector and education and agriculture compared with urban regions. Demography An analysis of the age structure of the population of rural areas shows a number of trends with a serious impact: •
•
•
•
• •
•
•
A much higher share of population of the 65 and older age group in the total population of rural and especially “extreme” rural regions, i.e. regions with rural population between 90-100 % (compared with predominantly urban areas (between 14-16 %); A much lower share of the work contingent (percentage of females 15-59 years old and males 15-65 years old) in the total population living in rural areas (approximately 60 %) compared with urban areas (approximately 66 %). A generally much lower proportion of women of reproductive age (between 18-49 years of age) in the total population of rural areas compared with urban areas. In “extreme” rural regions the respective coefficient equals only 35 % (e.g. Sisak-Moslavina county), i.e. about 10-14 percentage points lower than in the majority of urban regions (48-49 %). A much lower percentage of young women (age 20-29) in the total population in rural regions compared with urban areas. Although in both rural and urban areas natural population growth has been negative in recent years, there has been a much stronger decline in rural areas compared with urban regions (e.g. in “extreme” rural areas the population decline was approximately three times stronger than in predominantly urban regions); Many rural areas are characterised by very strong natural depopulation trends, five times stronger than the average of Croatia; Natural population growth rates differed strongly between the regions. In a number of extreme rural areas the vital index (live births per 100 deaths) during the year 1998-2002 amounted to less than 50 %, e.g. Lika-Senj county, compared with 100-112 % in Zadar county or 100-120 % in Dubrovnik-Neretva county (positive natural population growth). An analysis of educational structure shows a number of negative developments characterising the situation in rural areas of Croatia. The most important are as follows: In the majority of counties, the percentage of those who live in rural areas and have finished basic school only (over 15 years of age) varies as much as 20-35 %. In some counties, e.g. Meñimurje county, almost every third adult person living in rural areas has only a basic education. Generally speaking, a percentage of people who finished basic school only (grades 13 or grades 4-7) in the total population of age 15 and above is in rural areas almost twice as high as in urban regions; The Census data shows that in all 21 counties the share of people without any education is much higher in rural than in urban areas. The percentage of population over 15 years of age without any education, in some rural areas, is 3-4 times higher than the respective ratio in urban 197
•
areas of the same county (e.g. county Zadar or county Karlovac). In Zadar county or Šibenik-Knin county every 12th adult person living in rural areas has not finished any school (even primary!). In the Mountain Region the respective coefficient of those who have not finished any school is almost 60 % higher than the country’s average; The rural regions are especially disadvantaged regarding the share of persons with medium or higher education, e.g. a secondary level of vocational education, high school, or a university degree. In some counties coefficients showing the proportion of population with a higher level of education living in urban areas are only one quarter.
4.4.1.3 Agricultural and Rural Policy The Pre-accession Economic Programme 2005-2007 and National Programme of Integration of the Republic of Croatia into the EU, drafted annually in the Republic of Croatia, give the overall legal framework for design of the agricultural policy. The Strategy of Agriculture and Fisheries, Act on Agriculture and Act on State Subsidies in Agriculture, Fisheries and Forestry define the specific sectoral legal framework and define concrete measures for the agricultural sector. The emphasis in these documents is on the agricultural structural policy measures. With regard to the unfavourable structure of agricultural households in the Republic of Croatia (fragmented family agricultural households with prevalence of old members, farmers with mainly low education, depopulated rural areas, insufficiencies in rural infrastructure, bulky inefficient state agricultural combinates, processing industry insufficiently developed, etc.), the agricultural policy is aimed at speeding up changes of structural policy e.g. land policy, rural development, consolidation of agricultural land, diversification of farm activities, increase of competitiveness, development of manufacturing organisations, etc. In the previous period the Croatian government has undertaken numerous actions and implemented many projects in the area of agriculture with the main objective of improving its structure and increasing competitiveness. Until the proposed reform of the agricultural policy in Croatia in 2003 there was no clear separation between market policies and rural development policies. Croatian structural policies were more production-oriented. Furthermore, the objectives set in the Strategy of agriculture and fisheries were often neglected due to political pressures of various lobby groups. There was also no comparable programming of the policy as in the EU. Together with the reform of production subsidies in 2003, new support schemes were introduced in agriculture. Rural development became one of the keystones of agricultural policy. Further activities were oriented to establishment of an institutional and administrative system for rural development measures. The concept of majority envisaged national rural development measures is still at the inception stage. The exceptions are investment support for agricultural holdings and income support for non-commercial agricultural holdings, which have had more effect on the rural development. Implementation of SAPARD measures will assist rural development administration to organise, 198
implement and control domestic measures in this area. Until now rural development aspects of regional policy have not been given satisfactory importance. It is necessary to ensure a coordination of rural development policies and programmes under regional development policies since responsibility for those two policies is located in two ministries, MAFWM and MSTTD. Lessons learnt During the preparation and implementation of EU and other fund it has become obvious that Croatia is facing the new challenges in its present stage of development, looking forward to future integration with an enlarged EU. The most specific constraints of rural economies in Croatia are: -
Low competitiveness of key rural sectors, including agriculture, food processing, forestry etc. Insufficiently developed rural infrastructure; Insufficient access of rural population to public goods; Existence of war damaged and depressed rural areas; Low education level of rural population; Problems relating to management of rural environment and natural resources. Weak vertical institutional linkages between ministries and county/municipality level institutions. Weak horizontal institutional linkages and between ministries and other public bodies. Lack of coordination between different authorities concerning policy and strategy development and enforcement as well as the implementation of activities in the agricultural and rural sector. Lack of professionalism of specialised agencies to support governmental institutions and to implement specific measures. Additional support for institutional capacity strengthening is required to increase the performance of central and local institutions responsible for rural development and to better involve the rural stakeholders in order to apply the EU acquis.
Objectives and strategy of the SAPARD programme The SAPARD Programme 2005 – 2006 constitutes a strategy which aims to tackle specific drawbacks in the rural areas in Croatia. However, regarding the short-term character of this Plan, its strategic perspective has to be seen in a wider context: - The plan fits into the structural and procedural frameworks set up in preparation for Croatia’s EU accession, in accordance with the „Stabilisation and Association Agreement”, the European Union’s “Opinion on the application of Croatia for membership of the EU”, the Council Decision on the “Principles, Priorities and Conditions contained in the European Partnership with Croatia”, the Memorandum of Understanding of the establishment of the National 199
-
-
-
Fund and the Multiannual Financial Agreement which are both going to be signed by the Republic of Croatia and the European Commission. The Plan incorporates long-term strategic views, which allow the agricultural and rural sector in Croatia to thrive and to prosper in an enlarged EU for the soci-economic development of the livelihoods of its rural citizens, for a healthy environment, and in harmony with the principles of the Common Market. The Plan can be considered as a first step towards setting up the legal, administrative and financial operational frame for the implementation of further EU co-financed programmes, especially the Instrument for pre-accession Assistance for Agriculture and Rural Development (IPARD) for the period 2007-2013. The integrated planning process of IPARD will be in parallel with the implementation of the SAPARD Programme. Thus building up the mechanisms for SAPARD implementation will have a very useful impact on the increase of the institutional capacities and human resources while building up the management structures and control systems for IPARD. The integrated approach in the Plan means also first step for a concerted solution of priority problems in the rural areas with regard to achieving a whole complexity of desirable social, economic, environmental and cultural effects and by the synergetic use of the available resources. Within the frame of IPARD complementary priority development issues such as the maintenance and creation of alternative income activities, environmental, landscape and agricultural management or human development through improved vocational training, establishment of the producers groups, can be integrated and will allow, in very practical terms, the mobilisation of EU, national, regional and local resources to tackle specific issues and opportunities, while at the same time building the capacity and experience of rural dwellers working in partnership in their local communities to define better their own needs, and develop appropriate solutions and design local development strategies to manage their implementation.
National Development Objectives In 2005, the Croatian Government Office for Strategic Planning has drafted a National Development Strategy, which outlines three global development objectives are pursued to: -
-
Achieve accelerated growth in real GDP and employment, as well as higher living standards compared with more prosperous regions of Europe; Obtain higher competitiveness of the national economy compared with more developed regions of Europe; Reduce regional disparities within the country by creating favourable conditions for social-economic development in the most backward regions.
200
In June 2005, the preparation of the Croatian National Development Plan (NDP) has started with a delay under the CARDS 2003 project “Support to National Development Planning”. This CARDS project is of key importance to support Croatia to prepare for the effective use of both, EU pre-accession and Structural Funds. The overall objective of this project is to enhance Croatia’s development planning and implementation capacity through the elaboration of the National Strategic Reference Framework (NSRF) and the corresponding Operational Programmes (OP) based on a wide consensus and in line with EU best practices and regulations. Furthermore, one of the specific objectives of the project is to prepare NSRF according to EU best practices and regulations - including priorities; measures and indicative budgets. As such, the NSRF should include relevant sectoral and regional operational programmes and should incorporate relevant existing strategies. The NDP will outline the overall integrated development strategy for Croatia as a whole with a view to narrowing the development gap between Croatia and the EU member states. General objectives for agriculture and rural development The overall national objectives and the fundamental principles outlined above constitute the framework for the national objectives concerning sustainable agriculture, forestry, fisheries and rural development. The MAFWM has translated the overall development vision in the National Agricultural and Fishery Strategy of the Republic of Croatia (ARDP) (MAFWM, 2004) into long-term development sectoral strategy goals: -
Improved competitiveness and efficiency of primary agricultural, forestry and fishery production; Improved competitiveness and efficiency of processing and marketing of agricultural, forestry and fishery products; Improved quality and hygiene standards, as well as environmental and animal welfare standards; Additional employment opportunities and income for farmers and all people living in rural areas leading to improved living standards and working conditions; Achieving sustainable rural development through optimised and balanced economic development, environmental preservation and social cohesion.
A comprehensive action plan to implement these very broad strategic goals set out in the National Agricultural and Fishery Strategy through concrete measures has not yet been elaborated by the MAFWM. The different financial support schemes and specific sub-sector programmes in Croatia have insufficiently incorporated measures to improve the quality and hygiene standards, as well as environmental and animal welfare standards in the production and processing sectors, as well as instruments to stipulate effective economic development, environmental preservation and social cohesion to achieve a sustainable rural development process.
201
General objectives of the SAPARD Programme In accordance with the above-mentioned national and sectoral priorities, the general objectives of the SAPARD Programme integrates the principles on “Community support for pre-accession measures for agriculture and rural development in the applicant countries of central and eastern Europe in the pre-accession period” laid down in Council Regulation (EC) 1268/1999, Art. 4.3 “In their plans, applicant countries shall ensure that priority is given to measures to improve market efficiency, quality and health standards and measures to create new employment in rural areas, in compliance with the provisions on the protection of the environment” and in the Council Regulation (EC) 2257/2000 specifically taking into account Croatia’s candidate status: -
The implementation of the Acquis Communautaire concerning the Common Agricultural Policy (CAP) and related policies; Finding sustainable solutions for pressing adaptation problems in specific priority fields of the agricultural sector and Croatia’s rural areas.
Priorities of the SAPARD Programme In accordance with the SAPARD-Regulations and the conditions laid down in the framework of the European Partnership, Community support is provided for sustainable agriculture and sustainable rural development measures for the preaccession period within priority areas. Taking into account the results of the SWOT analysis and the shortcuts in the implementation of the above described National Agricultural and Fishery Strategy of the Republic of Croatia, the identified development priority areas of the SAPARD Programme are as follows (MAFWM,2004): - Priority 1: Development of the rural economy; - Priority 2: Improving the access to markets; - Priority 3: Development of rural infrastructures; The three priorities focus on the economic development of specific sub sectors (1 and 2) or following a territorial approach (3). Specific objectives and corresponding measures of the SAPARD Programme The short implementation time, as well as the limited financial volume makes it indispensable to make clear-cut choices on the specific aims, which are to be achieved in each priority field. This inevitably narrows down the focus to measures which have a high expectable leverage effect on the rural economy and living conditions and which meet an urgent need for intervention. Therefore, the specific objectives of the SAPARD strategy will only partly cover the difficulties illustrated in the SWOT analysis of the agricultural sector and the rural areas in Croatia. The SAPARD measures will complement the implementation of the National Agricultural and Fishery Strategy. They will focus on supporting the development of commercial agricultural holdings and competitive food-processing enterprises through 202
improved market and technological infrastructure and strategic investment policies aimed at improving the access to national and international markets by reaching EU standards. Equally, the SAPARD assistance will contribute to a sustainable and social coherent rural development process consistent with international environmental practices by developing the rural economy, enhancing income and providing and securing employment opportunities in the rural areas to counterbalance disparities between regions and compared to urban areas, as well as to develop and rehabilitee basic rural infrastructure, also in war effected areas. One specific objective per priority area has been defined and will be made operational through a measure: Table 4.16: Specific objectives per selected priority Priority Specific Objective 1. Development of the rural economy
Corresponding Measure Investments in agricultural holdings
Strengthening and improvement of the agricultural production capacity 2. Improving the Strengthening and Improving the processing and access to markets improvement of the capacity for processing and marketing of marketing of agricultural agricultural and and fisheries products fisheries products 3. Development of Creating better living Improvement of rural infrastructures conditions in rural areas infrastructure in rural by improving rural areas with specific infrastructures handicaps Supportive measure: Technical assistance, information and publicity campaigns Source: MARWM, 2004.
4.4.2 The first experiences of rural development in Croatia Several interviews were made about the current situation of rural development in Croatia, and these interviews draw a rather clear picture of the present conditions of the institutional system, the main problems and directions of development. Besides heads of ministry departments, heads of county offices and leaders of development agencies, and representatives of non-governmental organisations were interviewed. The main conclusions of these interviews are the following: •
The preparations of Croatia’ s accession to the EU have been speeded up since 2004, during which the modernisation process of the Croatian institutional system and development policies have been started, with the need to harmonise them with the EU policies. The currently running rural development programmes of the Ministry of Agriculture, Forestry and Water Management were attempted to fit to the EU requirements. 203
•
•
Within the Ministry several departments consider themselves authorised to deal with rural development affairs, and at the same time there are several departments in other ministries that work in the area of rural development in a wider sense. Within the Ministry of Agriculture, Forestry and Water Management there is the Bureau for the Development of Rural Areas, which was established in 2004 and has 3 divisions, one of which is called Office for the Development of Villages and Village Farms. They started to work in November 2004, with the objective to create all the legal documentation needed for supporting agriculture and its sustainability, fisheries ad forestry. The Bureau for the Development of Rural Areas declared a number of priority areas for rural development measures, which are the following: - To prepare school education, teaching, training and development programmes, plans, projects for agriculture, fishery, forestry, hunting and rural development. - Foundation and development of agricultural cooperatives, - Foundation and development of cooperatives of producers of fishery products as well as of fish and mussel breeders cooperatives. - Investments to family farms, fish and mussels breeding, private forestry, and game breeding. - Processing, storage and trade of fishery products and forestry products. - Special support to rural women, young farmers, young fish and mussel breeders by pilot projects. - Renewal and development of the rural countryside (rural infrastructure, environmental conservation). - Development of rural tourism, fishery tourism and hunting tourism. - Preservation of the traditional folk inheritance.
•
The other government authority to deal with rural development is the Bureau of Agricultural Policy and International Cooperation. It contains three divisions, namely the Department of Agricultural Policy, the Department of European Union and Trade Integration Affairs, and the Department of International Relations.
•
Currently the most important programmes dealing with rural development are: SAPARD, CARDS, RT IPARD, INTERREG, PHARE. The implementation of the programmes is delayed. One of the reasons for the delay is that there are too many institutions involved in the direction of implementation, the second is the too long process of discussions and negotiations, and the third reason is the continuous change in the structures of the directing institutions. For rural development the ministry requested 80 million Kuna in 2005, but the Sabor, the Croatian Parliament promised only 30 million for this purpose.
•
The Croatian SAPARD is directly focused on rural development and it contains 15 measures. These are grouped into the following three main categories: Priority 1: support for rural and agricultural activities, farms 204
Priority 2: support for processing industry Priority 3: support for the development of local infrastructure, and of local communities. •
•
•
•
The organisation of the SAPARD Agency has already been approved of by the relevant national decision makers, and now it has already entered the accreditation process of the European Commission. This leaves only half a year to actually utilise the available funding within the framework of the programme. Due to the great enthusiasm of the involved finally the available time has been extended somewhat. The acceptance of the concept of rural development in the rural areas is rather contradictory. The head of the Rural Development Directorate of the Ministry of Agriculture, Forestry, and Water Management said about this: „our first problem is the fact, that everything is just new to us. The next problem is the availability of well prepared personnel, this is one of our weaknesses. Another difficulty is the lack of information about rural development ideas, although this is supposed to be our task to know everything about it. The staff of the ministry, but generally the staff of any ministry, as well as the rural population know very little about the meaning of rural development. There are many things to do in this field, because the majority of the people believe, that rural development is really nothing else than supporting small scale farmers of 1-2 hectares of land. Rural development, however, is a very wide concept, and within this only a rather narrow segment deals directly with basic agricultural production.” As a summary it may be stated that the rural development programmes of a wider sense are not coordinated, there is no planning process covering all the levels and harmonising the various projects. The lack of coordination has led to the situation that it is impossible to tell the exact number and topics of rural development projects running currently in Croatia Listing the problems the following were found to be most typical: • There are not enough people to work on the large number of plans, projects and wishes. The offices carry out a lot of work on the field and it takes even more time and energy. • In political circles rural development is not really understood, they do not respect that the area would require specially trained people. • Croatia has not taken seriously enough the importance of developing rural territories. There are many programs, but their objectives, level of integration, and implementation is not very well known. • On the other hand another difficulty is the incorporation of these programmes into the lives of the not very well educated rural inhabitants, which sometimes creates resistance against the projects. • There is a recommendation to establish a separate rural development office but this has not yet been implemented. • The level and extent of authorities of various offices and bureaus has not been precisely defined in the area of rural development, 205
•
•
•
•
• •
•
•
•
and although there exists some kind of cooperation, but basically all the involved offices work independently. And they are unable to change situation on their own. The preparation of the programmes is rather complicated, the experts feel themselves that they are not well trained enough, and the peasants, the farmers are not prepared at all, and without them the programmes cannot be implemented. The unpreparedness and the lack of information may be one of the causes of resentment and fright of the people to participate in the projects. The political will is not clearly stated either, it is full of double messages, unclear statements and misunderstandings (e.g. it is not sure that the population is interested in these EU affairs at all.) There is opposition in the areas related to the uninformed, disorganised and unprepared behaviour, in policy-making and in expertise, and the decisions are often made by people who are not experts of the fields, but otherwise respected politicians. As an example, in Zagreb county there are 5 bureaus of authority in spatial development issues, and it is often said that spatial development is too complex a problem to be directed by only one bureau (covering education affairs, economic development, tourism, social affairs and health insurance systems). Thus the levels of authorities are overlayed. There are conflicts about administrative barriers, organisational changes and the allocation of money. Rural development is often identified with agricultural development which hinders the better organisational structure of the rural development institutions from a political aspect, too. Cooperation between the local and the national powers is weak. Those on the national level are directed by the EU also, and do not have time nor wish to discuss things with the local level. The lower, local level does not see the need for their own initiative and they rather wait for someone from above to solve their problems for them.
Most of all the leaders of Meñimurska and Koprivnicko-Križevacka counties had positive experiences about Hungarian relations, the other had only plans and expectations. Altogether the relationship with Hungarian rural development offices is weak, most of all because of language difficulties, and the Croatian borderline counties have better linkages to Slovenia. Only a low proportion (1/6) of the interviewees mentioned and considered the importance of non-governmental organisations in rural areas. More than that considered the role of small enterprises important, and said that the support for small enterprises could help to keep the population in the rural regions. Many respondents complained that tourism by the Adriatic does not rely sufficiently on Croatian agriculture. Croatian specialities, as cheeses, are completely missing from the menus of the 206
hotels by the seaside. Generally they think that the relationship between tourism and agriculture is not satisfactory. Within the framework of the research a survey was also made in the borderline counties of Croatia and Hungary. Altogether 50 enterprises and 50 municipalities responded to the questionnaire in Hungary, in counties Baranya, Zala, and Somogy. In Croatia the scope of respondent was widened to have a more detailed picture about the current situation in rural development. Thus, besides mayors of the settlements and agricultural entrepreneurs, farmers the leaders of farmers’ organisations, municipal officers responsible for tourism and for rural development were also among the respondents. Altogether 101 questionnaires were completed in Croatia, of which 52 % were entrepreneurs, and 48 % belonged to the above listed group of leaders, officers and policy makers. •
The Croatian respondents considered the following to be the most important problems in their country: • Too many regulations by the state (23 %) • Lack of investments (17 %) • Too complicated administrative requirements (14 %) • Strong market competition (13 %)
• The most useful improvements that could help the success of their enterprises would be: • The protection of the home market (18 %) • More extensive activity of the state in supporting developments (18 %) • Decreased levels of taxes (15 %) • Simplified administration requirements (15 %) • The priorities of the development policy should balance the home needs and the external (EU) requirements (10 %) •
The respondents expect from the new institutional structure of rural development the increased activity and responsibility of the state, which is explained by the lack of capital and the lack of knowledge.
•
28 % of the Croatian respondents have already prepared rural development projects and another 5 % is planning to do so. In comparison with the Hungarian situation this proportion is similar to the years of 1990-1999 in Hungary. The reasons for not preparing such applications were the following: • Lack of experience, they have not applied to funding before (28 %) • Lack of own resources (23 %) • Lack of sufficient information (21 %)
•
In Croatia 67 % of the respondents have not submitted proposals, which is a sign in itself of the fact, that the rural areas, and the villages are not seriously considered as potential development target areas. The proposals deal with the classic agricultural activities (crop 207
growth and livestock husbandry) and besides these there are proposals about environmental conservation, and the renewal and revitalisation of villages including the preservation of cultural traditions. The applications are prepared by the applicants themselves, while the applicants in Hungary use professional help. The ¾ of the proposals were submitted in 2004 and 2005, when the state actors started to work on the introduction of the new pre-accession programmes and the preparation of laws and institutions. The respondents listed altogether 30 supported projects, which received an average funding of 500 000 Kuna (1 Kuna= 40 HUF). The average support received by Hungarian projects in the period of 1990-1999 was 7603 000 HUF. •
The Croatian respondents said that they have not received sufficient information about the applications either from the announcers of the application possibilities or from other institutions supposed to help (e.g. ministries, county level offices), and the information available by the media, internet, is also insufficient. The applicants do not exactly know who are responsible for providing information, and they would generally want to have more help in putting together the proposal. With the winner projects they find the regulations, control and monitoring processes too complicated.
•
About 42 % of the Croatian respondents feel positive about Croatia’s accession to the EU. They expect better access to the EU funds and resources, more job opportunities, speedier economic development, higher living standards, more transparent legistation, better information flows, and altogether greater development.
•
Regarding the future 72 % would like to establish connections and cooperation with Hungary. According to the Croatian respondents the business relations to Hungary in the borderline Croatian countries are not very intensive. Only 19 % of the respondents have business relations with Hungary. When questioned about their wish to establish such connections 16 % considered it not very important, 25 % would like to establish connections only for the purpose of joint projects, while 45 % considers it a good opportunity for building trade and other relations (15 % did not respond to the question).
•
Altogether 63 % of the Croatian respondents indicated the possible areas of cooperation. The following areas were mentioned: • Protection of original products from the Meñimurska area • Retraining and further training for fruit growers • The growth and modernisation of production • Agricultural programmes • Organisation of wine trails, wine tours • Organic production of cereals • Preservation of the traditional architecture of villages • Various farm development programmes • Building freezer storehouses 208
• • • • • • • • • •
Preservation of biological diversity Preservation of traditional crafts Plantation of orchards Development of small and medium-size enterprises Development of pig breeding Trainings for entrepreneurs Development of the infrastructure Village development Social care Establishment of the justification of product origin
209
Chapter 5 - The preconditions of successful cooperation for development in the Croatian-Hungarian borderline areas 5.1
The resources of the Croatian-Hungarian borderline area, general situation analysis
The balanced development of the Croatian and Hungarian states based on the mutual interests provides good foundations for the cross-border cooperation of the two countries. The borderline territories, being peripheral, and altogether less developed than the country average, are particularly interested in the development of cooperation. The areas by the opposite sides of the border are geographically similar, because the areas between the Sava river and the Hungarian border are often mentioned as parts of the Pannon Basin. The areas have the characteristics of plains, hillside, and in a small territory, mountains of medium height. The area is poor in natural resources, it is mainly the agroecological features, the hydrological potential and forestry that are worth mentioning. At most parts of the border river Drava separates the two countries. The Danube is currently neglected in the cross-border relationships, although it may become an outstanding region of cooperation in the future The only problematic issue of the „borderline philosophies” of the two countries is the ideas about utilising the long common borderline of the river Drava. After many debates about the utilisation of the area, Hungary established the Danube-Drava Nature Reserve Park on the Hungarian side, and thus, have decided for its own side the utilisation of the area for a long time. The Croatian partner has also reexamined the problem, and the Croatian plan of constructing a hydropower station, and currently considering the option of nature conservation besides the power station as realistic options for the development. There are several examples of transboundary cooperation between the two countries. The Duna (Danube)-Drava-Sava Euroregional Cooperation (acronym: DDSZEE) is an initiative relying on the formerly existing relationships (town twinning, county twinning) that was established in the hope of accessing external financial support (EU and national funding) and partly as a preparation for the accession to the EU, in November 1998. Based on the relationships established earlier, and after searching for the proper forms of regional cooperation, the agreement was signed in September 2000 about the establishment of the Drava-Mura Euroregion. The southern Transdanubian border region and the neighbouring Croatian regions have participated in several cooperation programmes in the past 210
years. Within the framework of these former cooperations studies were completed about the resources of the borderline area, and the opportunities of mutually advantageous cooperations. In general it can be stated that the best opportunities for cooperation are in the fields of tourism, transport, infrastructure, and in education and cultural cooperation. In the borderline area assessed, the incomes of the population generated by the traditional agricultural activities are not sufficient for the increase of the living standards. The rural development support by the EU may provide resources for such areas for increasing the living standards, if the suitable institutional system is established. This creates a further area of cooperation in the rural areas, that is, the exchange of experiences about rural development and infrastructural development problem. In the following section the situation analysis of the Hungarian-Croatian borderline region will be showed, based on the results of former studies and research. The SWOT analysis of the South Transdanubian region covering the borderline Hungarian countries will be shown describing the resources and conditions helping or hindering the development processes. This is followed by the assessment of the findings of a survey carried out in the framework of the Interreg project, and then the summary and comparison of the general experiences and the conclusions of the primary research. Table 5.1: The SWOT-analysis of the border region South Transdanubia Hungarian-Croatian Borderline Strengths -
The existence of geographically broad international relations covering many sectors
-
The key actors of the region (regional development council, county governments, towns on county rank, chambers, universities) are committed and they are active in the international relations.
-
Tourism, which has a significance in the international relations as well, is above the national average.
-
Many tourism attractions, such as the Lake Balaton, are well known abroad.
-
The South Transdanubian Region has a river qualified as an international waterway (Danube).
-
Ethnic diversity, living links with the mother countries. 211
TOURISM Siklós-Harkány-Villány wine and thermal tourism, Pécs, Osijek, Varazdin urban tourism, Mohács ethno tourism, Thermal tourism on both sides of the border (Hévíz, Zalakaros, St.Martin, Bizovacke, Varazdinske) EDUCATION Major university in Pécs and Osijek, Developing university institutions in Križevci, Varazdin, Keszthely and Kaposvár. ENVIRONMENT The existence of an extensive cross-border natural preservation area (Danube-Drava National Park), together with the River Mura Rich water resources (surface, thermal)
-
High proportion of inhabitants who speaks foreign languages.
-
Well developed higher education structure.
-
A rich intercultural and historic heritage.
-
Rich wine regions.
CULTURE Pockets of multiethnic communities in certain areas of the eligible area.
Weaknesses - Casual links and communication between the actors active in the international relations. - Lack of financing for the development of international relations. - There are many actors in the regional marketing and their work is not coordinated and partnership-based. - Outdated transportation network as a whole, inadequate international accessibility. - Not enough foreign capital investments. - Weak industrial export capacity. - The region is a relatively closed economic-social unit.
TRANSPORT Non-electrified international railway connections from Pécs and from Osijek. Bad state of internal road system makes accessibility of intraregional centres and interregional thoroughfares hard. Scarcity of international border crossings (62 km on average). DEMOGRAPHY Marked internal differences in age structure. Rural populations and border microregions with dramatically different age structures. EDUCATION Low ratio of higher education qualifications compared to national average. Low level of mutual language skills. Inflexible labour market, educational institutions are slow in responding to market demand. LABOUR MARKET Critically high unemployment rate on both sides of border, especially on Croatian side, Extremely high unemployment rate in rural microregions, Extremely high unemployment rate in many microregions along common border. Mismatch between supply and demand. NATURE AND ENVIRONMENT Insufficient flood system, Insufficient waste water and solid waste management deteriorating the Mura-Drava ecological system, Undetonated landmines remaining from 1991 war. 212
Opportunities Active and successful participation in the EU’s international cooperation programmes. - Extra EU support for the development of transport routes in order to eliminate the geographical/transport isolation of the region. - Enhanced cross-border (Croatian) and international (North-Italian, South-German) links. - Stronger links with the stabilizing Balkan area. - Growing importance of the southern border of the region as a Schengen-frontier. - After a successful accession, EUrelated knowledge transfer for the Balkan regions that wish to accede as well. - Opportunities in wine tourism.
TOURISM The Danube-Drava natural reserve area potential for tourism. ENVIRONMENT Reforestation of areas unsuitable for high value added agricultural production. BORDER CONTROL Gradual elimination of internal border after Croatia’s EU entry in the Schengen framework (Croatia inside Schengen from 2009) CULTURE Increasing depth, value added and duration of cultural cooperation, Cooperation and networking in the field of joint built and other heritage management. ECONOMY Potential for vertical integration in processed agriculture, Potential to export agroforestry.
Threats - Deteriorating cooperation between the actors of the region involved in the development of international relations. - Maintaining the lack of financing needed for the cultivation of international relations. - Due to the poor economic activity of the region, the level of the own resources of the regional institutions remain inadequate on the long term. - Constant isolation of the region in the international relations. - Qualified workforce needed for the development of international relations may leave the region (brain drain).
DEMOGRAPHY high degree of mobility and emigration away from region, continued depopulation in rural pockets. NATURE AND ENVIRONMENT Possible continued deterioration of Drava ecosystem by insufficient waste management. GOVERNANCE AND PLANNING Weakness of common planning, Lack of detailed plans in certain sectors (education, thermal tourism development), Small size of local governments prevents efficient local development policy. CULTURE Inadequate financing leads to deterioration of built cultural heritage.
Sources: DDRFT, 2003; VÁTI, 2006a
213
5.2 Cooperation possibilities and priorities
5.2.1 Tourism Main tourist attractions - Natural and built environment Tourism is highly concentrated in certain microregions within the eligible area. There are considerable touristic capacities by the shores of Lake Balaton in Somogy and Zala counties. Lately the decreasing numbers of foreign tourists coming to the region are counterbalanced by the growing demand of Hungarian tourists. Most of the investments tourism-related investments in the region point at the construction of several hotels and resort centres. The Sármellék Airport had 80 000 travellers in 2006, and in this year they intend to reach the limit of 100 000 passengers. This has crucial importance for the thermal spas and the tourism sector of the lake Balaton. The Drava area is characterised by water and environmentally oriented tourism. The architectural heritage of Pécs encompasses amongst others Roman and Turkish sites, and has been awarded the UNESCO World Heritage title. The city attracts a considerable flow of tourists, both domestic and foreign. However, there has been a steady decline in the number of visitors in the city since 2002, and visitors only spend an average of 2.1 nights there. Nearby, the Harkány-Siklós-Villány area is rapidly developing into a very strong centre of wine and thermal tourism, recognised on the international level. An increase in the number of visitors here has been able to counterbalance the decrease in the number of nights spent (down from 5.5 to 4.5 in 2000). Apart from the above, tourism shows a sizeable presence in Kaposvár and Szekszárd. In the Croatian side of the border the town of Osijek has significant built heritage, with some 39179 overnights per year. The castle of Trakoscan in Varazdinska county also has 56778 overnights. The town of Varazdin itself counts some 42759 overnights per year. Thermal tourism is already strongly present in the region, and a further potential exists in the region. The two sides are currently mostly competitors in this sector, although there is a potential for joint marketing and other forms of cooperation. Hévíz, Kehidakustány and Zalakaros are important destinations in Zala county. The St. Martin Spa in Meñimurska county is also an important destination with 10200 overnights per year. Bizovačka Spa in Osjecko-baranjska County: 34767 overnights. Varazdinske Spa in Varaždinska County: 80177 overnights.
214
5.2.2 Cultural, professional and scientific connections with the Hungarian side In both countries there are minorities of the neigbouring countries, although in rather low numbers. The proportion of Hungarian minorities in Croatia is not more than 0.37 %. Hungarians can be found in largest proportions in Osjecko-baranjska county, the Hungarian minorities are 3 % of the population. Altogether 16595 people professed to be of Hungarian origin in the 2001 census. In Hungary, 15620 individuals professed to belong to the Croatian minority in 2001. Some of them live in the eligible area (Zala 36.38 %, Baranya 16.23 %, Somogy 6.21 %), but more than half of them live north of the eligible area, along the Austrian border in Vas (34.7 %) and Gyır-Moson-Sopron (34.16 %) counties. As for cultural cooperation, an agreement on cultural, educational and scientific cooperation was signed between Government of Repubilc of Croatia and Republic of Hungary in 1994 to regulate cooperation in those areas. Implementation of that Agreement is achieved through three-year programmes signed by line ministries of the two countries. Last programme was approved for the 2006 – 2008 period. Cooperation is achieved in a number of areas. • • •
•
•
• •
Cooperation of Archives: State Archive from Osijek cooperates with State Archive from Pécs. Cooperation of Libraries: Public library from Beli Manastir (under which is a Central Hungarian Library) cooperates with Libraries in Baja, Pécs and Mohács. Cooperation of Museums: Archeological museum in Zagreb cooperates with Archeological museum in Budapest, Archeological museum in Pécs and Museums in Székesfehérvár and Veszprém. Museum in Osijek cooperates with Museum in Pécs. Cooperation in Arts: Gallery in Osijek cooperates with Institute for protection of cultural heritage in Budapest, Gallery from Pécs and Modern Gallery from Pécs. Open college from Samobor cooperates with County Museum Janus Pannonius from Pécs. Balen Gallery in Slavonski Brod cooperates with Trafo Gallery in Budapest, Institute for Contemporary Art in Dunaújváros and Mőcsarnok Gallery in Budapest. Gallery from Slavonski Brod cooperates with institute for Contemporary Art from Dunaújváros. Cooperation of Theatres: Croatian National Theatre in Osijek and Croatian Theatre in Pécs. Children’s Theatre from Osijek and Children’s Theatre from Pécs. Croatian National Theatre from Osijek and National Theatre from Pécs. Cooperation in area of Publishing: University of Philosophy from Zagreb and Insitute for Croatian language and linguistics work on the publishing of Croatian – Hungarian Dictionary. Cooperation of Universities: University of Philosophy from Osijek and University of philosophy from Pécs established together Croatian studies in Pécs University and Hungarian studies in Osijek University. 215
5.2.3 The priorities of development in the region Priority 1.: River Drava Ecotourism Border Project Common central project to utilise the Drava-Danube nature protected region for ecotourism based job creating development Priority 2.: Common Economic, Educational and Linguistic Space 2.1. Common Economic Space Support for common economic Labour market development (partner finding sites, (information) fairs, etc.)
cooperation
2.2. Common Educational and Cultural Space Cross-border higher Cross-border education projects intermediary level (training, R&D) education projects (common training, exchange, etc.) 2.3. Bilingualism in the border region Mutual language training
Cross-border lower level education projects (Common training, exchange, etc.)
Bilingual signs
Priority 3. Technical Assistance Source: VÁTI, 2006a. Many developments that would be welcome will be the result of a long process of gradual development policy. These include: - the reversion of ageing in the region, - the reversion of emigration and mobility away from the region. Ideas requiring more efforts than is available within a particular cooperation project. These are the following: • • • • •
The improvement of extraregional accessibility. This is already taking place with the construction of the highways to/from Zagreb, Budapest, Vienna/Maribor and Belgrade. the improvement of intraregional road infrastructure, the improvement of intraregional rail infrastructure, the building of new bridges on the river Drava to eliminate the cul-desac position of settlements. The improvement of the human capital of the region.
216
5.3 The findings of questionnaires and interviews in the Croatian-Hungarian borderline region 5.3.1 The characteristics of the sample As a part of the research in the framework of the INTERREG project a survey was made in the spring of 2006 by questionnaires in the borderline counties of Hungary and Croatia. In the Hungarian counties 50 enterprises and 50 municipal leaders responded to the questionnaires from Zala, Somogy and Baranya. In Croatia the scope of respondent was widened to have a more detailed picture about the current situation in rural development. Thus, besides mayors of the settlements and agricultural entrepreneurs, farmers the leaders of farmers’ organisations, municipal officers responsible for tourism and for rural development were also among the respondents. Altogether 101 questionnaires were completed in Croatia, of which 52 % were entrepreneurs, and 48 % belonged to the above listed group of leaders, officers and policy makers. The largest part of the questionnaire contained comparable questions and the difference of the Hungarian and the Croatian questionnaire referred to the present condition of the institutional system of rural development, and the future directions of progress, because the different historical roots of the two countries and the different stages of the accession to the EU make these institutional systems different. The objective of the survey was to assess and compare the situation of organisations and enterprises involved in rural development in the borderline counties. Both questionnaires were preceded by interviews. Although the sample size is rather small, within the framework of the INTERREG project – with very strict restrictions on spending project funding in a non-EU country – it was not possible to increase the number of respondents. Howeverm the experiences gained from the interviews with rural leaders, and the local knowledge of the involved Croatian experts were carefully considered in designing the sampling strategy and selecting the respondents to receive a valid picture of the borderline situation. The Croatian interviews pointed out the main weaknesses of the institutional system of rural development, its fragmentation and the low level of transparency of the rural development projects. As the new strategy of rural development is linked to the SAPARD in Croatia, of which the winning projects start in September 2006, so the questions were aimed at the level of preparation and involvement of county level, town and village level institutions, and whether enterprises are also involved in these projects to some extents.
217
The distribution of the Hungarian respondents was the following: 50 % (50 respondents) were municipal leaders and representatives of the local goverments, and the other 50 % entrepreneurs, of which 9 % shareholding companies, 18 % Limited companies, 9 % sole traders and 9 % small scale farmers. Another 5 % were other business forms including 1 % family farmers and the rest cooperatives. By the area of activity of the enerprises 88 % are agricultural enterprises or deal with forestry or fishery, and this proportion is true for each county, too. In Baranya 6.7 % of the respondents were industrial enterprises and all of them are limited companies. In the other two counties the proportion of the industrial enterprises was neglectable. The largest group of the enterprises (29.0 %) employs less than 4 employees, and the next largest group is the enterprises employing 20-49 workers (25%), then the group of 50 to 249 employees (22 %). Their distribution by counties show the same distribution as above, while in Somogy the proportion of enterprises employing 50 to 249 workers is higher than the average in the sample (34.6 %). For the sole traders and small scale farmers the number of employees is less than 4 persons, while for municipalities the typical number is higher than 20. It is interesting to notice, that even for shareholding companies it is very rare to have more than 250 employees. In the case of the Croatian enterprises (52 % of the respondents) the majority, 66 % were family agricultural enterprises, 26 % limited companies and 12 % sole traders of other activities (industry, services). In the respondent institutions and enterprises 68 % had less than 10 employees, 25 of them had more than 10 employees. There were no businesses or organisations of 250 or more employees.
5.3.2 The most important problems of the respondents in Croatia and Hungary The Croatian respondents mentioned the following problems: • Too many regulations by the state (23 %) • Lack of investments (17 %) • Too complicated administrative requirements (14 %) • Strong market competition(13 %) The most useful improvements that could help the success of their enterprises would be: • The protection of the home market (18 %) • More extensive activity of the state in supporting developments (18 %) • Decreased levels of taxes (15 %) • Simplified administration requirements (15 %) • The priorities of the development policy should balance the home needs and the external (EU) requirements (10 %).
218
It is obvious that the respondents expect the new institutional structure of rural development the increased activity and responsibility of the state, which is explained by the lack of capital and the lack of knowledge. For the Hungarian enterprises the most important problems were the lack of working capital and investment capital (56 and 22 % respectively). As the second most important problem again the lack of investment capital (42.2 %), the legal requirements and regulations (24.4 %), and the strong competition (15.6 %) were mentioned. In the third place the legal requirements (21.1 %), high wage costs and insurances (34.2 %), high taxes (13.2 %), and the requirement of the EU and the market competition (10.510.5 % each) were mentioned. The municipal leaders were not asked about this aspect.
5.3.3 The activities of respondents in applying for project funding In Hungary the respondents were asked about their activities in preparing project proposals and implementing projects in the 15 years since the transition of 1990. 1990-1999: The respondents have submitted 2 project proposals on average, and have received support for 1.26 projects with 7603000 HUF average support. There were no SAPARD project winners among the respondents. Assessing the distributions behind the averages 78.6 % of the respondents have not submitted project proposals at all in the periof of 1990-1999, 7.1 % submitted 1 proposal, and 1-2 % submitted 2 to 50 (!) proposals. Considering the type and form of the respondent organisations there are no significant differences between those who submitted proposals and those who did not, although municipalities showed higher willingness to apply for funding than the average. While, however, none of the enterprises did submit more than 2 proposals during the ten years, the municipalities show great variety, some of them had 1 to 4 proposals, but a few submitted 10, 20 and one of them as many as 50 proposals. It is obvious that for really active fund raising by proposals is possible only for larger municipalities with larger staff. In the year 2005 the application activities became more balanced, the proportion of those who did not submit any proposals decreased (24.5 %), and the enterprises submitted typically 1 to 3 proposals, while among the municipalities there some to have submitted 21 proposals. The highest number of accepted proposals was 17 projects, the average is about 2 projects, and the average financial support received by respondents is 17841000 HUF, while the highest support paid is 160 million HUF. The countywise comparisons show that the proportion of the non-applicants is somewhat lower than the average in Zala (17.6%) and higher in Somogy (26.9%) and the highest in Baranya (36.8 %) although is has considerably decreased compared to the years 1990 to 1999. 219
By the form and type of organisation again the municipalities are the most successful, two thirds of them has won 4 projects or less, while the remaining between 5 and 17. Considering the business enterprises the variety is lower, it is only the shareholding companies that have won 3 projects, the other businesses have not won more than 2 projects. Except for municipalities, about 40 % of the respondents have not won any support. In the case of the sole traders and small scale farmers 55.6 % has not received any funding, although 33.3 % of the sole traders and 55.6 % of the small scale farmers have not applied at all. Distribution of the winner projects, 2005 : It is clear that the higher willingness of application and higher application capacity was successful for the municipalities, because while the businesses have not won more than 3 projects, a large proportion of the municipalities wont 4 to 7 projects, and only a minority of them could not win any support. Among the enterprises the most successful group was the small scale farmers, then the limited companies and the least successful are the sole traders. Altogether 28 % of the Croatian respondents have already prepared rural development projects and another 5 % is planning to do so. In comparison with the Hungarian situation this proportion is similar to the years of 19901999 in Hungary. The reasons for not preparing such applications were the following: • Lack of experience, they have not applied to funding before (28 %) • Lack of own resources (23 %) • Lack of sufficient information (21 %) The Hungarian respondents chose the main reasons for not submitting project proposals out of 7 possible reasons: 1: not suitable call for proposals 2: not suitable financing structure 3: lack of own resources for the project 4: too bureaucratic 5: lack of information 6: preparation of proposal is too expensive 7: other The most frequent reason is the lack of own resources to use in the proposed project, and also the not suitable call for applications. Besides the costs of putting together a proposal, the not favourable condition of financing, and the exaggerated level of bureaucracy involved. In Croatia 67 % of the respondents have not submitted proposals, which is a sign in itself of the fact, that the rural areas, and the villages are not seriously considered as potential development target areas. The proposals deal with the classic agricultural activities (crop growth and livestock husbandry), and besides these there are proposals about environmental conservation, and the renewal and revitalisation of villages including the preservation of cultural traditions. The applications are prepared by the 220
applicants themselves, while the applicants in Hungary use professional help. The three quarters of the proposals were submitted in 2004 and 2005, when the state actors started to work on the introduction of the new preaccession programmes and the preparation of laws and institutions. The respondents listed altogether 30 supported projects, which received an average funding of 500 000 Kuna (1 Kuna = 40 HUF). Considering the frequency of applying and the success of the applications the Hungarian results were the following: Most of the applicants used the help of some consulting agencies (63.5 %), the others (28.4 %) prepared the proposals themselves. In the case of the individually prepared proposals the proportion of refused proposals is somewhat higher (9.5 %) than for the proposals prepared with the assistance of consultant agencies (4.3 %). It was interesting to see that no proposals were successful of those prepared with the help of the accountant of the entrepreneur, a family member or some other help. The Croatian respondents said that they have not received sufficient information about the applications either from the announcers of the application possibilities or from other institutions supposed to help (e.g. ministries, county level offices), and the information available by the media, internet, is also insufficient. The applicants do not exactly know who are responsible for providing information, and they would generally want to have more help in putting together the proposal. With the winner projects they find the regulations, control and monitoring processes too complicated. The accepted projects are important for the winners, but these are not the only resources for them, because they are aware of the limited financial support for development by the state, and of the uncertainties of winning or losing. Thus they consider the projects additional development resources, and although they are happy to be winners but they do not dare to rely on this entirely. Currently 45 % of the Croatian respondents watch regularly the calls for proposals, the same proportion is much higher in Hungary, 85.3 % regularly watches the announcements, and 9.3 % does so occassionally. By the Croatian respondents the most important elements of such projects are the financial funding, then the education and the knowledge transfer, but when asked about the actual measures they would like to see in rural development, the majority still mentions the need to increase the government support for agriculture.
221
5.3.4 The main problems of the rural areas in Hungary and Croatia in the borderline counties – findings of the questionnaires The respondents were asked to list the problems they consider most important for the rural areas of their countries. The following problems were mentioned most frequently by the Hungarian respondents: • • • • • •
Lack of job opportunities, Insufficient rural infrastructures Not enough activities by the states, insufficient support Ageing population, depopulation Too weak competitiveness on the market Low producer prices, low farm-gate prices
Besides the above the lack of money, unsatisfactory quality of life, the fragmented farm sizes, the requirement of own resources for proposals, the problems of qualifications and the problems of the infrastructural system. Assessing the importance of the objectives/priority areas of rural development The respondents were asked to rank the following areas of rural development on a scale of 1 to 5, where 5 is the rank of the most important area and 1 for the least important one. 1: Development of enterprises in general 2: Development of small and medium-size enterprises 3: Development of rural micro-enterprises 4: Development of local services 5: Development of rural infrastructure 6: Development of villages 7: Improvement of transport, traffic and rural road networks 8: Microregional centre 9: Integration of the Roma and the empoverished population into society 10: Development of employment possibilities 11: Development of the social economy 12: Development of human resources The respondents ranked the objectives 1, 2, 3, 5, 6, 7 and 10 rather similar. These all refer to the development of rural infrastructure and the improvement of conditions for enterprises. The average rankings are 3.58 – 4.00 for the group. Another separate group was found for objectives 4, 8, 9, 11, 12 , which are about improving the quality of life in a rural environment, and the resolution of the social problems. The average rankings are between 2.82 and 3.36. This separation of the importance of the priorities is present in the countywise results, too. This means, that in every county the development of enterprise conditions are considered to be the most important task of rural 222
development, and the resolution of social problems is considered to be less important. There are slight differences, however, among the counties, with county Zala having the most balanced results and Baranya the most contrasting ones. It is also interesting to see that both Somogy and Zala ranked the development of local services in the same way as the conditions for establishing and running an enterprise. The most important and the least important objectives by county are shown in the following table: Table 5.2: The importance Baranya Least 4. important Development (average of local ranking) services (2.47)
of the priorities Somogy 9. Integration of the Gypsy and the empoverished population into society (2.81) Most 7. 6. important Improvement Development (average of transport, of villages ranking) traffic and (4.15) rural road networks (3.95) Difference: 1.48 1.34 (most important -least important) Source: Authors’ own construction
of rural development Zala Total 9 Integration 9. Integration of the Gypsy of the Gypsy and the and the empoverished empoverished population population into society into society (2.98) (2.82) 6. 5. Development Development of villages of rural (4.11) infrastructure (4.00) 1.13
1.18
Similar tendencies can be noticed in the distribution of respondents by the type of the organisation. The former pattern holds here too, that is, the higher rankings are allocated to the priorities enhancing the enterprise development processes (1,2,3,5,6,7,10) and the social aspects (4, 8,9,11,12) were ranked lower. For the municipalities the social aspects were somewhat higher ranked, and objective no. 4 (Development of local services) received very high rankings, while for the entrepreneurs this aspect was considered among the least important ones. Generally the municipalities ranked higher all the objectives/priorities, than the enterprises. Besides, the order of the ranking also differ. The municipalities give the least importance to the objective 8 (Microregional centre) and 9 (Integration of the Roma and the empoverished population into society) but even these receive higher rankings than all the rankings given by small scale farmers and sole traders except for no. 7 (Improvement of transport, traffic and rural road networks). 223
The objective no. 10 (Development of employment possibilities) was ranked high by all respondents except for sole traders.
5.3.5 Cross-border relationships and their importance In Hungary the majority of the responding enterprises (23 enterprises, that is, 46 % of the responding enterprises) sells in the national (home) market. Another 20 % of them sells in the market of the county or the region, another 16 % for the local market and 12 % sells in export markets (6 % did not answer to this question). 42 % of them have partners in production, 36 % in sales and 14 % has no partners at all (8 % did not respond). The Hungarian enterprises and municipalities were asked about Croatian partners and cooperation. 87 % of them had no Croatian partners of connections, 6 % had one such partner, 2 % has two or more Croatian partners. They consider the existing cooperation very good, and the cooperation is of the business type, export and import. The higher numbers of Croatian partners occur in Somogy county (19.2 %) while Zala has the least such partners (1.9 %). By the organisation type the limited companies have more than 2 partners, while the majority of the municipalities and the small scale farmers have no such partners at all, nor for the sole traders. It is also surprising that a high proportion of the shareholding companies have no Croatian partners at all, and the proportion of those who have one Croatian partner is very low. Those having Croatian partners consider the quality of the relationship medium or good quality (3 or 4 on a 5 grade scale), so they can be considered satisfied with it. 30 % of the respondents said that it would not be important to establish connections to Croatian partners, 41 % consider it of complementary importance besides their usual activities and 15 % consider it very important. Assessing the enterprises by their targeted markets the enterprises selling for export consider Croatian partners of complementary importance (50 % had this opinion, while 33 % already have Croatian partners), 26 % of the enterprises selling for the national (home) market considered it very important, and 17.4 % of them considered it of complementary importance, as they probably try to enter the international market by this way. Similar opinions were received from the enterprises selling for the county or regional market, while 50 % of the local sellers did not consider Croatian partners important, or of complementary importance (37.5 %). Assessing the answers by counties the proportion of those considering the Croatian partner relations very important was the highest in Somogy (34.6%), but this was also the county where the highest proportion of the respondents (42.3 %) considered such relationships not important. In county Zala the majority (54.7 %) considered Croatian connections of complementary importance, as well as in Baranya (42.1 %), and the proportion of those rejecting such connections is the lowest here (22.6 %). 224
These results are probably explained by the geographic situation and the transport linkages. It is also interesting to see that the limited companies show the highest proportion for rejecting the importance of Croatian relationships (44.4 %) and they are followed by small scale farmer and sole traders (the proportion of rejection is 33.3 % for both groups). Among limited companies, shareholding corporations and small scale farmers only 11.1 % considers the Croatian partners very important. The situation is similar for sole traders, too. The largest group of the shareholding corporations (33.3 %) and the municipalities (54 %) considers Croatian connections of complementary importance, and it is exactly these two groups in which the proportion of those rejecting the Croatian connections is the smallest (22.2 % and 26.0 % respectively). Assessing the opinions of the respondents on the accession of their country to the EU, again an interesting picture may be found. In Hungary 31 % of the respondents have rather positive opinions about the impacts of the accession, while 27 % consider it neutral and 22 % negative, and among them 7 % very negative. The 42 % of the Croatian respondents are positive about Croatia’s future accession to the EU. They expect better access to the fundings and resources of the EU, more job opportunities, faster economic development, higher living standards, more transparent legislation, better access to information, and in general, enhanced development. 72 % of the Croatian respondents wish to establish cooperation with Hungary in the future. The respondents said that the business relationships with Hungary are not very intensive, and only 19 % of the respondents have some business linkages to Hungary. In more details, 16 % considered linkages to Hungary unimportant, 25 % considers it important only for the sake of joint projects, and 45 % considers these relationships important either for business or other areas (15 % did not answer this question). Assessing the quality of the existing connections in a 1-5 scale the average mark was 3.5, with the majority of the answer being 3, 4 and 6, which is very similar to the Hungarian opinions. Considering the forms of the cooperation most of the respondents have business relationships, but town level relationships within the framework of Phare CBC or INTERREG projects, and scientific and research cooperation were also mentioned.
5.3.6
Rural development projects, opinions information about the applications
225
on
the
The Croatian respondents mentioned 31 projects related to rural development in a wider sense. Of these there are 12 for which the contracts have not been signed, for 2 the contracts have been signed but the implementation has not been started yet, 7 projects are being implemented and 5 has already been completed, but are still waiting for the financial support, and 6 projects have not been assessed by the relevant authorities. The average cost of these projects is 500 000 Kuna (1 Kuna is approx. 40 HUF). The topics of the projects are mainly of the agricultural character (development of fruit production, vegetable processing, development of farms including the increased numbers of animals for breeding or for fattening (pigs)) . But there are also examples of projects to establish a naive arts gallery, reconstruction of the rural traditional house in Molvar, the utilisation of alternative energy sources, the establishment of an online tourism management system by the border, too. Most of the project proposals were prepared to gain funding because of the lack of own resources, but another important reason for applying was the attractive financial conditions of the support scheme. Approximately 20 % of the applicants were interested really in building connections, and some also mentioned the existence of a similar project proposal which could be implemented by the present opportunity. The idea of the project was the own idea of 40 %, 18 % got the idea from a local institution, 6 % read about the possibility in a newpaper, and 6 % heard about it from an expert, and, interestingly, 6 % of the proposal ideas came from Hungarian partners. Information related to the application process were received from consultants and extension agents, their work was rated 3.8 (on a usual 5 grade scale). The second most used information source is the homepage of the Ministry of Agriculture, Forestry and Water Management, rated 4.2. The information received from business partners was also rated high. Negative opinions were given about the information available at the local authorities (town or district), the Economic and Crafts Chamber, and the media (newspapers, radio). The Hungarian respondents gave the following evaluation about the value of information sources: Large differences are found between the frequency of usage and the level of satisfaction. This is the case for the printed media, which is frequently used, but the level of satisfaction about its quality is low. At the same time, the municipalities are rather rarely used as information sources, but then, the quality of the information they provide is rather satisfactory. The same is true for the microregional non-profit agency. The applicants frequently use the information provided by the organisations offering funding for projects but the applicants are not too satisfied with the information they provide.
5.3.7 Difficulties of the application procedure The difficulties mentioned most often by the Hungarian respondents were the too delayed administration about the proposal, the unnecessary claims to provide additional documentation for the proposal, the unclearly defined 226
application and implementation procedures, which are all related to the technical arrangements of the application and implementation procedure. The next group of difficulties is related to the financing and liquidity problems, that is, the delayed payments, the post-financing procedure, that is, the applicants have to pay the costs in advance from their own resources and receive refunds later. The next group of problems is the difficulties of maintaining contact with the organisation providing the funding, the not satisfactory ways of communications and the troublesome and bureaucratic arrangements of financial accounting about the project. These latter two reasons are of much less importance than the first group of problems (only one third of the respondents considered them problematic in comparison to the numbers complaining about the first problem group). The possibility of using credits to avoid liquidity problems was also assessed with the following results: only 35 % of the respondents used credit for the project, and 27 % answered the question about the interest rate of this credit. The average amount of the credit was 28879 thusand HUF, of the duration 26.8 months (with 120 months as the longest duration). The average interest rate was 5.3%, but occassionally 14 % interest rates were also encountered. There was no significant relationship between the amount of support won by the project proposal and the amount of the credit the applicant used. For the Croatian respondents the administrative difficulties were most important, and they also complained about the non-financed activities, the non-professional management of projects, the non-refunded costs. They think that the projects should receive 70 to 100 % support, the majority considers 80 % of support ideal. 77 % of the Hungarian respondents and 81 % of the Croatian respondents would like to use free government consultancy. The same proportion of 81.5% for the municipalities in Hungary, but only 50 % for the sole traders. This indicates a kind of distrust about the application procedure and the consultants as well. There were no significant differences in this by counties. The respondents were asked about the topics of projects they would willing to participate in: Altogether 63 % of the Croatian respondents indicated the possible areas of cooperation, while 37 % did not reply to the question. The following areas were mentioned: • • • • • • • • • •
Protection of original products from the Medimurska area Retraining and further training for fruit growers The growth and modernisation of production Agricultural programmes Organisation of wine trails, wine tours Organic production of cereals Preservation of the traditional architecture of villages Various farm development programmes Building freezer storehouses Preservation of biological diversity 227
• • • • • • • • •
Preservation of traditional crafts Plantation of orchards Development of small and medium-size enterprises Development of pig breeding Trainings for entrepreneurs Development of the infrastructure Village development Social care Establishment of the justification of product origin.
5.3.8. Summary The population of the Croatian borderline counties is only one third o three quarters of the neighbouring Hungarian borderline counties. The population of Koprivničko-križevačka county was 124 427 persons in 2001, while the population of Meñimurska country was 126 500 and the population of Virovitičko-podravska was only 93 389 persons. In comparison, at the opposite side of the border there are Baranya county with its 404 709 population and 301 settlements (towns and villages), Somogy county with 395 701 inhabitants and 245 settlements and Zala county with 297 853 inhabitants and 257 settlements. In the three Croatian counties altogether 14 000 enterprises work, and the number of enterprises is highest in Meñimurska county (5534) while in Virovitičko-podravska county somewhat more than half of this number (3137). In the Croatian agriculture the fragmented land sizes have remained a problem after the privatisation. Nowadays 72.6 % of the farms work on less than 10 hectares, and 16 % has the average farm size under 4 hectares. In the three Hungarian counties the settlement structure and the economy is typically rural. Except for the county level towns (having the same administrative status as a county for themselves), and the areas around Keszthely and Siófok the settlements of the borderline region are small villages and small towns. Therefore the role of rural development is even more important than in microregions of more industrialised and centrally located areas. In comparison, two of the three assessed borderline regions have rather well developed industry, and it is only Virovitičko-podravska county where agriculture is more emphasised. In the other two counties the market of the agricultural products is largely determined by the highly developed food processing industry. In the Croatian counties the small villages are not typical, except for a few smaller areas. In Croatia in 2004 the total number of employees was 1409631, while the number of registered unemployed persons was 309875, which means an unemployment rate of 18 %. 228
In all of the assessed peripheral Hungarian and Croatian border regions a common problem is the high rate of rural unemployment, which leads to the decrease of rural population, and the out-migration of the highly qualified young labour force. Thus it is an essential strategic objective of rural development is to stop and turn back this negative process, and there is considerable local demand for the development and training of human resources fitted to the local resources, conditions and possibilities. The number of consultants, project preparation experts familiar with agricultural and rural development support schemes is not sufficient. Both in the Croatian and the Hungarian counties the number of university or college graduates is lower than the country average. In 2001 the proportion of the population older than 60 years has reacher 22 % in Croatia (the same proportion was only 16 % in 1971), while the proportion of 0-39 year-old population has decreased to 51 % from the 61 % of 1971. In Croatia rural development has just been started, it is still at its beginnings. Some pre-organisations have been established, reorganised from 3 divisions into 6, but have not started to work. In 2006 a rural development strategy is prepared, which is entitled: Strategic guidelines for the development of agriculture and rural areas for 2006-2008. Within the Ministry several departments consider themselves authorised to deal with rural development affairs, and at the same time there are several departments in other ministries that work in the area of rural development in a wider sense. Currently the most important programmes dealing with rural development are: SAPARD, CARDS, RT IPARD, INTERREG, PHARE. The implementation of the programmes is delayed. One of the reasons for the delay is that there are too many institutions involved in the direction of implementation. The second is the too long process of discussions and negotiations, and the third reason is the continuous change in the structures of the directing institutions. As a summary it may be stated that the rural development programmes of a wider sense are not coordinated, there is no planning process covering all the levels and harmonising the various projects. The lack of coordination has led to the situation that it is impossible to tell the exact number and topics of rural development projects running currently in Croatia The population lacks information about the future opportunities, and the demands and expectations are greater than the possibilities. Listing the problems the following were found to be most typical: • •
There are not enough people to work on the large number of plans, projects and wishes. The offices carry out a lot of work on the field and it takes even more time and energy. In political circles rural development is not really understood, they do not respect that the area would require specially trained people.
229
• • • •
•
• •
•
• • •
Croatia has not taken seriously enough the importance of developing rural territories. There are many programs, but their objectives, level of integration, and implementation is not very well known. On the other hand another difficulty is the incorporation of these programmes into the lives of the not very well educated rural inhabitants, which sometimes creates resistance against the projects. There is a recommendation to establish a separate rural development office but this has not yet been implemented. The level and extent of authorities of various offices and bureaus has not been precisely defined in the area of rural development, and although there exists some kind of cooperation, but basically all the involved offices work independently. And they are unable to change situation on their own. The preparation of the programmes is rather complicated, the experts feel themselves that they are not well trained enough, and the peasants, the farmers are not prepared at all, and without them the programmes cannot be implemented. The unpreparedness and the lack of information may be one of the causes of resentment and fright of the people to participate in the projects. The political will is not clearly stated either, it is full of double messages, unclear statements and misunderstandings (e.g. it is not sure that the population is interested in these EU affairs at all). There is opposition in the areas related to the uninformed, disorganised and unprepared behaviour, in policy-making and in expertise, and the decisions are often made by people who are not experts of the fields, but otherwise respected politicians. As an example, in Zagreb county there are 5 bureaus of authority in spatial development issues, and it is often said that spatial development is too complex a problem to be directed by only one bureau (covering education affairs, economic development, tourism, social affairs and health insurance systems). Thus the levels of authorities are overlayed. There are conflicts about administrative barriers, organisational changes and the allocation of money. Rural development is often identified with agricultural development which hinders the better organisational structure of the rural development institutions from a political aspect, too. Cooperation between the local and the national powers is weak. Those on the national level are directed by the EU also, and do not have time nor wish to discuss things with the local level. The lower, local level does not see the need for their own initiative and they rather wait for someone from above to solve their problems for them.
According to the Croatian respondents the business relations to Hungary in the borderline Croatian countries are not very intensive. Only 19 % of the respondents have business relations with Hungary. When questioned about their wish to establish such connections 16 % considered it not very important, 25 % would like to establish connections only for the purpose of joint projects, while 45 % considers it a good 230
opportunity for building trade and other relations (15 % did not respond to the question). Regarding the future, 72 % would like to establish connections and cooperation with Hungary.
5.4 Possibilities of cooperation and development Experiences and recommendations based on the research in the borderline counties: -
The research was focused on reviewing the practice of Hungary and Croatia in rural development in the past decade, the characteristics and efficiency of the established institutional system, the administrative structure behind it, and the correspondence of the rural development programmes to the rural development policy of the European Union.
-
The basic challenge of rural development is then to keep the rural population in the countryside by creating attractive conditions for their life and work, relying on the local resources and on their careful, integrated and sustainable utilisation. Besides the economic potential the main resource of rural development is the healthy, active and selfconfident local community.
-
In Hungary the first rural development measures began in 1998. In the following years the national, county level and microregional rural development programs have been outlined and the Hungarian territorial units have made preparations for receiving funds from the EU. Access to the rural development financial support from the EU the framework of the national Agricultural and Rural Development Plan (AVOP, or ARDOP) was created, for which the SAPARD pre-accession program prepared the rural countryside before the accession. Following the accession to the EU the programming documents of agriculture and rural development for the period 2004-2006 have been prepared, namely the ARDOP and the National Rural Development Plan (NRDP).
-
Considering the activities of the borderline counties regarding the ARDOP project applications their performance is similar to the average of the Hungarian counties. Comparing the three counties the following can be stated: •
Zala had the highest number of successful applications, altogether 178, that is, 5.7 % of all the successful applications in Hungary. However, the amount of support required was relatively small for these projects, so Zala received only 4.6 % of the total allocated support. 231
•
Somogy was the weakest of the three counties considering the success of the applications, the number of successful projects was only 136, that is, 4.4 % of the successful applications of the country, and 4.0 % of the funding came to this county.
•
Baranya is between the two former counties with 159 successful projects. Here the project proposals were of a larger amount of expenditures and this left 5.8 % of total funding to the county.
-
The sole traders applied for only smaller projects and their received funding was also smaller. The largest amounts of support was received by companies. Zala is somewhat different in this respect, because here some municipalities also received large amounts of funding for infrastructural developments. Somogy is similar to the national average, while Baranya is outstanding for the rather large fundings received by companies.
-
The questionnaires and interviews completed during the spring of 2006 helped us to understand the situation regarding the ARDOP support scheme in the three counties. The main findings are the following: •
The representatives of organisations involved in the decision making of the agricultural and rural development programmes are very satisfied with the SAPARD and the ARDOP, too. The success is obvious in three main areas.
The bureau to accept the applications, decide about payments and organising the monitoring process, has been set up, the consultancy network to assist in preparing and implementing the projects is ready and there are profitoriented consultant agencies as well as non-governmental organisations in the field of project preparation.
The potential applicants themselves have learned the way of preparing successful project proposals under the conditions of the applications system much more bureaucratic than before.
•
The representatives of the authorities say that one of the most serious problems is the post-financing system of the projects.
•
The leaders of the municipalities mentioned that since 1990 the reconstruction of the municipality system of the villages have developed considerably. The self governance of the villages liberated new energies and the local communities have started to participate in the public affairs. Considerable improvements have been achieved in public services and in the water and sewage systems.
232
•
The same kind of improvement was experienced regarding the enterprises. The development was seen in the size of the businesses, which has taken place step-by step for the respondents. The states subsidies contributed a lot to this increase of the agricultural enterprises, especially in the growth of the machinery capacities.
•
The municipalities and the rural farm enterprises suffer from different problems, but the lack of capital and low level of financing is a common problem for all.
•
There were problems with the operation of the microregional associations of settlements, because their organisation and operation were not always satisfactory for the involved settlements.
•
The respondents said that the most important priority of rural develpoment would be to stop out-migration and create new job opportunities. In assessing the last two years of the accession to the EU the respondents put the greatest emphasis on the direct financial advantages, that is, on the subsidies. Those who have already received some subsidies are positive about the accession, while tose who have not received support are hoping to get some later.
•
•
The first National Development Plan was considered to be an important step forward – in spite of all its problems and difficulties. Settlements without these development resources would be unable to make improvements, because of the lack of sufficient amounts of own resources.
•
The local development actors try to utilise any application possibilities even if they will risk that the proposed users of the development, that is, the inhabitants of the village, will be dissatisfied with its quality (e.g. in spite of having bad quality roads inside the village, the leaders initiate the construction of roads leading to the farmlands – simply because application opportunities offer subsidies for the latter, but not for the former). The raising of the required own resources is often difficult for the applicants, although nowadays they tend to save on everyday management expenses and the savings are allocated to projects as own resources.
•
Many entrepreneurs and municipal leaders complained about the party politics to interfere with the allocation of subsidies and making decisions not quite in line with professional considerations.
•
The interviewed actors indicated that the market of preparation and management of applications has been developing, with many agencies and organisations offering their services from the preparation of the proposal to the implementation of the project. 233
This process is in line with the expectations of the relevant authorities. •
For the next national development plan the respondents would put more emphasis on job creation, and together with that, the strengthening of the SMEs. It is also important to improve the public services and public infrastructure, but more importance is given to the increased number of taxpayers and the creation of new jobs.
•
The majority of the respondents does not have any connections with Croatia. Village mayors said that the villages have the ideas, concepts and strategies that the local community would consider improvements. These ideas, concepts are ranked in a way that projects can assist in achieving each, one by one. Some initiatives will have to be speeded up, others are delayed, depending on the calls for applications, waiting until a suitable application opportunity is announced. Occassionally the project itself is not so useful, but the applicants cannot afford to miss any project opportunities, because these may create jobs, manage smaller objectices, and may leave some savings to support other projects with own resources.
•
•
The Hungarian enterprises and municipalities were asked about Croatian partners and cooperation. 87 % of them had no Croatian partners of connections, 6 % had one such partner, 2 % has two or more Croatian partners. The higher numbers of Croatian partners occur in Somogy county (19.2 %) while Zala has the least such partners (1.9 %). This may be explained by the geographical location, length of the common border and the transportation networks.
•
For the Hungarian enterprises the most important problems were the lack of working capital and investment capital. Other important problems are the market competition, the legal requirements and regulations, high wage costs and insurances, high taxes and the requirement of the EU.
•
Rural development should focus on a few emphasised problem areas in the future. The most important priorities should be the development of conditions assisting the operations of enterprises (business development, development of SMEs, development of microenterprises, development of transportation and employment). Respondents considered social problems (development of villages, local services, establishment of a microregional centre, integration of the Roma and the empoverished population into society, development of social economy, development of human resources) only of secondary importance. The counties differ slightly, Zala shows the most balanced distribution, while Baranya has the strongest contrasts in this respect. 234
•
The respondents have actively participated in solving development tasks by applying for project funding. Since 1990 the project application activities have steadily increased. While in the 90-ies only 25 % of them submitted project proposals, nowadays this proportion is higher than 75 %.
•
The ARDOP project funding is typically targeted at rural areas. In 2005 81 % of the respondents have applied for ARDOP funding, and 20 % more than once.
•
Most of the applicants chose the application because they were unable to find other resources for their project plan, or because the project conditions seemed very favourable, but another frequent reason was that they already had a complete project plan which could be easily fitted to the application procedure.
•
Applicants used several information sources in preparing their projects. The most important sources were the consultants, the printed press and the ministry homepages. These are followed by other development agencies, microregional non-profit agencies, and economic chambers. The least utilised information sources are the municipalities and business partners.
•
Only 10 % of the applicants could have implemented the project without the subsidy received. For the majority the actual project funding meant the only option to carry out their plan.
•
Many problems have hindered the implementation of the project. The difficulties mentioned most often by the respondents were the too delayed administration about the proposal, the unnecessary claims to provide additional documentation for the proposal, the unclearly defined application and implementation procedures, which are all related to the technical arrangements of the application and implementation procedure. The next group of difficulties is related to the financing and liquidity problems, that is, the delayed payments, the post-financing construction, the difficulties of maintaining contact with the organisation providing the funding, the not satisfactory ways of communications and the troublesome and bureaucratic arrangements of financial accounting about the project.
•
The majority of the applicants – approximately two thirds – used the assistance of an external project preparation agency, the others prepared the application on their own.
•
Among the ARDOP project measures the support for agricultural investments, the extension of alternative income sources for the rural areas and the development of agricultural infrastructures were considered to be most useful. It is worth pointing out, and remembered for the future that the respondents attached only 235
medium importance to the support for young farmers and for vocational training, while LEADER was familiar only for a small proportion of them. •
The First National Development Plan was considered to be successful, probably because of the large variety of project possibilities it offered for support, and these allowed the implementation of a large variety of objectives. It must be remembered, however, that the local municipalities tried to apply for any project funds that were available covering the whole extent of the deconcentrated project funding resources.
The assessed Croatian borderline counties are considered to be developed agricultural areas of the country. This means that the region has serious potentials for agricultural and rural development. The establishment of the rural development institutional system has not been fully developed yet, and it is very similar to the Hungarian situation a few years ago. Under such circumstances there are serious opportunities for cooperation either between the institutions of rural development or the economic and civilian actors involved in rural development.
Recommendations: •
•
•
In the short run it seems advisable to continue, deepen and extend the cooperation, exchange of experiences and transferring knowledge between the institutions of rural development. Unfortunately the institutional channels for this have not been created, but it would be rather easy to organise this kind of cooperation through the regional development agencies. In the long run the emphasis should be placed on designing and implementing joint rural development projects. These projects may include the rural development oriented utilisation of the river Drava, cooperation between rural enterprises, which are not fully utilised yet. Cooperation between economic chambers, association of entrepreneurs, settlements and microregions, should also be established, for which the resources by INTERREG could be successfully utilised. In is recommended to develop the human resources by efficient training and education programmes, in which the universities and higher education institutions could play a key role. The harmonisation of tertiary education and the launching of joint trainings in accordance with the needs of the market demand would be a possible way of successful and mutually beneficial cooperation.
236
References AEBR-EUREGIO (2006): The added value of cross-border cooperation. Association of European Border Regions (AEBR), www.aebr.net, AGEG-Flyer_en.pdf, download: 2006.06.15. AMBROSI, EUGENIO - RENER, TATJANA (2004): Cezmejni programi med Slovnijo in Italijo : z izkušnjami novim izzivom naproti - Programmi transfrontalieri fra la Slovenia e l’Italia : dall’esperienza all’affrontare nuove sfide . Štanjel : Agencija Republike Slovenije za regionalni razvoj, Regionalna pisarna ; Ljubljana : Urad Vlade, Republike Slovenije za informiranje, 2004, ISBN 961-91358-0-6 (Agencija RS za regionalni razvoj) ATI CLES (2004a): Servizio di valutazione intermedia del Programma Operativo dell’Iniziativa comunitaria Interreg III A/Phare CBC Italia-Slovenia 2000-2006 Primo rapporto tematico. ATI CLES S.r.l./ESA S.r.l. 1, Roma, aprile 2004 ATI CLES (2004b): Servizio di valutazione intermedia del Programma Operativo dell’Iniziativa comunitaria Interreg III A/Phare CBC Italia-Slovenia 2000-2006 Secondo rapporto tematico. ATI CLES S.r.l./ESA S.r.l., Roma, dicembre 2004 ATKINSON, A.B. (2003): Income inequality in OECD countries: data and explanations. CESifo, Working Paper no. 881. BAJNAI LÁSZLÓ - GUTAI BERTA (2004): A szlovák-magyar határmenti települések fejlesztésének lehetıségei a csatlakozás után. Váti Kht - Városfejlesztési rt. Projekt száma: HU0109-02, 2002/000-604-02, Budapest, 2004. nov. 30. BARANYI BÉLA (1999). A "periféria perifériáján" - a határmentiség kérdıjelei egy vizsgálat tükrében az Északkelet-Alföldön. Tér és Társadalom, 4. 17-44 BARANYI BÉLA (2000). Bihar-Bihor Euroregionális Szervezet létesítésének lehetıségei és esélyei (kézirat). Debrecen, MTA RKK ATI Debreceni Csoport, Debrecen BARANYI BÉLA (szerk.) (2001). A határ mentiség kérdıjelei az Északkelet-Alföldön MTA Regionális Kutatások Központja, Pécs BARANYI BÉLA (2002): Euroregionális szervezetek és új interregionális szervezıdések Magyarország keleti államhatárai mentén. Magyar Tudomány, 2002/11sz. 1505. o. BARANYI BÉLA (2004): A határmentiség dimenziói – Magyarország és keleti államhatárai. Dialóg-Campus Kiadó, Budapest- Pécs. BARANYI BÉLA - BALCSÓK ISTVÁN (2004): Határ menti együttmőködés és foglalkoztatás. Kelet-magyarországi helyzetkép. MTA KTI, Mőhelytanulmányok. MT.DP. 2004/20 BARANYI, B. - I. BALCSÓK - L. DANCS - B. MEZİ (1999). Borderland Situation and Periferality in the North-Eastern Part of the Great Hungarian Plain. Discussion Papers 31. (Series editor: Zoltán Gál.) Pécs BAUSCH, THOMAS - THOMAS DAX- UMBERTO JANIN RIVOLIN - FRANÇOIS PARVEX SERGEJA PRAPER - MARTIN VANIER (2005): Sustainable Territorial Development in the Alpine Space: Towards Long Term Transnational Cooperation. Alpine Space INTERREG IIIB Programme – Alpine Space Prospective Study. November 2005 BEHRENS, A. (2002): Regional Gross Domestic Product in the European Union 1999. Eurostat, General Statistics, Theme 1-1 /2002. Benko, Georges (1999): A regionális tudomány. Dialóg-Campus, Pécs-Budapest. BRAND, HELMUT - ULRIKE WOLF (2004): Evaluation of Border Regions in the European Union (EUREGIO). Grant Agreement No 2003104. First Interim Report. (2004-06-01 – 2005-6-01), Institute of Public Health, Westerfeldstr. 35-37, 33611 Bielefeld, Germany, July 2005 CAPPELLIN, RICCARDO (1993) : Interregional cooperaton and internationalisation of regional economies in Alps-Adria. In: Gyula Horváth (ed): Development Strategies in the Alpine-Adriatic Region. Centre For Regional Studies, Hungarian Academy of Sciences, Pécs, 1993, p.17-45 CAULFIELD, N. (1998): Mexican Workers and the State: From the Porfiriato to NAFTA. Fort Worth: Texas Christian University Press. CENTROPE (2006): Jövıkép: Centrope 2015. Consortium Centrope, Europaforum Wien, www.centrope.info COPUS, ANDREW K. (1997) A New Peripherality Index for European NUTS II Regions. Report for the Highlands and Islands European Partnership COPUS, ANDREW K (1999): A New Peripherality Index for the NUTS III Regions of the European Union. ERDF/FEDER Study 98/00/27/130. A Report for the European
237
Commission, Directorate General XVI.A.4 (Regional Policy and Cohesion) Rural Policy Group, Management Division, SAC Aberdeen September 1999 COPUS, ANDREW K and YVONNE LOUGHRY (2002): Baseline Data and Programme Impact Indicators relating to Peripherality. A report Commissioned by The Highlands and Islands Special Transitional Programme . The Rural Policy Group, Scottish Agricultural College, Aberdeen, Revised April 2002 CSATÁRI, B. (1999): A kedvezményezett kistérségek lehatárolásának módszertana (összefoglaló zárójelentés). MTA RKK Alföldi Tudományos Intézete és Számítóközpontja, Kecskemét. DDRFT (2003): A Dél-Dunántúli Régió nemzetközi-kapcsolati stratégiája. (The International Relations Strategy of South Transdanubia). Dél-Dunántúli Regionális Fejlesztési Tanács, Dél-Dunántúli Regionális Fejlesztési Ügynökség Kht., Kapos Innovációs Transzferközpont Kht.; CONSPACE INTERREG IIIB CADSES, http://www.deldunantul.com ECLAC (1951): United Nations, Economic Commission for Latin America, 1951. Economic Survey of Latin America 1949. Santiago: UN. ÉGER GY. (2000). Regionalizmus, határok és kisebbségek Kelet-Közép-Európában. Osiris K. Bp. 49-64 ENYEDI GYÖRGY (1996): Regionális folyamatok Magyarországon az átmenet idıszakában. Hilscher Rezsı Szociálpolitikai Egyesület, Budapest, 1996. ERDİSI F. - TÓTH J. (szerk.) (1988). A sajátos helyzető térségek terület- és településfejlesztési problémái. (Az 1986. november 4-5-én Szombathelyen tartott tudományos tanácskozás anyaga.) MTA RKK, Pécs ERDİSI FERENC (2002): A határmenti térségek kutatásáról. In : Pál Ágnes: Héthatáron. JGYF Kiadó, Szeged, 2002. , 43-59. EURÓPAI BIZOTTSÁG [2004a]: Új partnerség a kohézió érdekében. Konvergencia, versenyképesség és együttmûködés. Harmadik jelentés a gazdasági és társadalmi kohézióról. Luxemburg: Az Európai Közösségek Hivatalos Kiadványainak Hivatala, 206 oldal. EURÓPAI BIZOTTSÁG (2004b): A régiók szolgálatában. Regionális Politikai Fıigazgatóság, Luxembourg: Az Európai Közösségek Hivatalos Kiadványainak Hivatala, http://europa.eu.int/comm/regional_policy/index_en.htm EURÓPAI BIZOTTSÁG (2004c): Kohéziós politika 2007-tıl. Az Európai Bizottság jogszabályi javaslatai a kohéziós politika reformjára vonatkozóan (2007 és 2013 közötti idıszak) .Európai Bizottság , Regionális Politikai Fıigazgatóság , KN-61 -04-274-HU-J , Ténylap 2004, www.inforegio.hu EURÓPAI BIZOTTSÁG (2006): Régiók és városok a növekedés és a munkahelyteremtés szolgálatában: A kohéziós és regionális politikával kapcsolatos, 2007–2013 közötti idıszakra vonatkozó rendeletek áttekintése. Inforegio. Ténylap 2006. KN-76-06-084-HUD EUROPEAN COMMISSION (1996): First Report on Economic and Social Cohesion. European Commission, Brussels. EUROPEAN COMMISSION (1999): Sixth periodic report on the social and economic situation and development of the regions of the European Union, Luxembourg: Office for official publications of the European Communities. EUROPEAN COMMISSION (2001): ‘Unity, solidarity, diversity for Europe, its people and territory’, Second report on Economic and Social Cohesion, Luxembourg: Office for Official Publications of the European Communities. EUROPEAN COMMISSION (2002): European Competitiveness Report 2002. European Commission, Brussels. EUROPEAN COMMISSION (2003): Analysis of the impact of Community Policies on Regional Cohesion. Contract Number: 2002 CE 16 0 AT 171, FINAL REPORT. European Commission DG Regional Policy, October, 2003 EUROPEAN COMMISSION (2004a): Commission communication of 10 February 2004 "Building our common future - Policy challenges and budgetary means of the enlarged Union 2007-2013" [COM(2004) 101 final EUROPEAN COMMISSION (2004b): Commission communication of 14 July 2004 to the Council and the European Parliament "Financial Perspectives 2007 - 2013" [COM(2004) 487 - Not published in the Official Journal]
238
EUROPEAN COMMISSION (2004c): Working for the regions. Directorate-General for Regional Policy. Luxembourg: Office for Official Publications of the European Communities. http://www.europa.eu.int/ comm/regional_policy/index_en.htm EUROPEAN COMMISSION (2006a): Cohesion Policy: the 2007 watershed. Legislative proposals by the European Commission for the reform of cohesion policy (2007–13 period) . EU Regional Policy Factsheet EUROPEAN COMMISSION (2006b). Regions and Cities for Growth and Jobs: An overview of Regulations 2007-2013 on Cohesion and Regional Policy. Inforegio. Fact sheet 2006. KN76-06-084-EN-D EUROSTAT (2006): Homepage of Eurostat / Az Eurostat honlapja. http://europa.eu.int/comm/eurostat FÖRSTER, M. F. (1994): The effects of net transfers on low incomes among non-elderly families. OECD Economic Studies, No. 22, Spring ,181-211 FLYNN, DONNA K. (1997): We Are the Border: Identity, Exchange, and the State Along the Bénin-Nigeria Border. American Ethnologist. 24, 2, 311-330. FRIEDMANN, J. (1973): Urbanization, Planning and National Development. Beverly Hills Cal. , London. GABBE, JENS (2005): Governance and cross-border co-operation. Speech on the occasion of the RFO Annual Conference in Joensuu, North Karelia, Finland March 2005 GOLOBICS P. (1996). A határ menti térségek városainak szerepe az interregionális együttmőködésben Magyarországon. In: Határon innen - határon túl (szerk.: Pál Á., Szónokyné Ancsin G.), JATE Gazdaságföldrajzi Tanszék, Szeged 224-230 GOLOBICS P. - TÓTH J. (1999). A nemzetközi regionális együttmőködés és Magyarország térszerkezete. In: Változó környezetünk (szerk.: Tóth J., Wilhelm Z.), Janus Pannonius Tudományegyetem TTK Földrajzi Intézet - MTA RKK Dunántúli Tudományos Intézet, Pécs. 7-22 GREN, JÖRGEN (2003): Reaching the Peripheral Regional Growth Centres. European Journal of Spatial Development. http://www.nordregio.se/EJSD/-ISSN 1650-9544Refereed Articles Jan 2003-no3 HARDI TAMÁS - NÁRAI MÁRTA (2001): A határ menti területek jellegzetességeinek átalakulása a 20. század végi Nyugat-Magyarországon. Tér és Társadalom, 2001, 2. sz., 107-130. HARDI TAMÁS (2004): Az államhatárokon átnyúló régiók formálódása. Magyar Tudomány, 2004/9 991. o. HDR (1991): Human Development Report, 1991. The United Nations Development Programme, New York HDR (2005): Human Development Report, 2005. The United Nations Development Programme, New York HOOVER, E. M. – F. GIARRATANI (1999): An Introduction to Regional Economics. Regional Research Institute, West Virginia University, http://www.rri.wvu.edu/WebBook/ Giarratani/main.htm. Download: 25.06.2006. HORVÁTH, GYULA (1993): Cooperation of Central European Regions. . In Gyula Horváth (ed): Development Strategies in the Alpine-Adriatic Region. Centre For Regional Studies, Hungarian Academy of Sciences, Pécs, 1993, p.47-79. HORVÁTH, GYULA (ed., 1993): Development strategies in the Alpine-Adriatic Region. Centre for Regional Studies, Hungarian Academy of Sciences, Pécs, 1993. HORVÁTH GYULA (1998a). Európai regionális politika. Dialóg Campus, Budapest-Pécs HORVÁTH GYULA (1998b): Az átmenet regionális határai Közép-Kelet-Európában. Területi Statisztika, 1. (38.) 1998/4. 295-318. HORVÁTH GYULA (2004): Regionális egyenlıtlenségek Európában. Magyar Tudomány, 2004/9 962. o. HRABÁNKOVÁ, M. - BACSI, ZS. -KOVÁCS, E. - STANKOWSKI, S. - MOUDRÝ, J. - ČERMÁK, B. - ROLÍNEK, L. - ŠKODOVÁ PARMOVÁ, D. (2006): Structural Policy and Rural Development in the EU. University of South Bohemia, České Budějovice. IDELE (2006): Cross-border and transnational cooperation for local employment development. An Eighth Thematic Report of the IDELE Project. The European Commission (DG Employment, Social Affairs and Equal Opportunities) IDELE project to “identify, disseminate and exchange good practice in local employment development”. www.ecotec.co.uk/idele, idele_thematic_report_crossborder.pdf. letöltés: 2006.június. ILLÉS IVÁN (1983): Regionális gazdaságtan. Tankönyvkiadó, Budapest. ILLÉS IVÁN (1993). A Kárpátok Eurorégió. Valóság. 6. 12-19
239
ILLÉS IVÁN (2000): Határok és határmenti együttmőködés Közép- és Délkelet Európában. INCO (internetes folyóirat), 2. szám. http://www.inco.hu/. KEEBLE, .D – OFFORD, J. – WALKER, S. (1988): Peripheral Regions in a Community of Twelve Member States, Commission of the European Community, Luxembourg KSH (2006): http://www.ksh.hu, download: 2006.08.15. KONCZ JÁNOS (2004): Európai Unió: határbontástól a régióépítésig. A természeti, anyagi és humán erıforrások hasznosítása a határmenti együttmőködésben. Európai Mőhelytanulmányok, 93. sz. KRUGMAN, P (1992).: The Rich, the Right, and the Facts. Deconstructing the Income Distribution Debate. The American Prospect. Volume 3, Issue 11. September 1, 1992. KRUGMAN, P. (1995): Development, Geography, and Economic Theory. The MIT Press, Cambridge, Massachutes, London. KÜHL, JÖRGEN - MARTIN KLATT (2004): Nemzeti kisebbségek és határokon átnyúló együttmőködés Európában. Kézikönyv. Határ menti régiók intézete, Dél-dániai Egyetem. Institut for Gronseregionsforskning 2004 (file: MOM-HU.doc) KÜRTI LÁSZLÓ (2006): Határkutatás - a regionális tudományok új ága? Magyar Tudomány, 2006/1 29. o. LACZKÓ LÁSZLÓ (2002): A sajátos helyzető térségek problematikája különös figyelemmel a határmenti területekre. In: Pál Ágnes: Héthatáron. JGYF Kiadó, Szeged, 2002., 61-70 LENGYEL IMRE (2000): A regionális versenyképességrıl. Közgazdasági Szemle. 12. 962– 987. o LENGYEL IMRE (2002): A magyar-román gazdasági kapcsolatok néhány jellemzıje a DélAlföldön. In: Pál Ágnes: Héthatáron. JGYF Kiadó, Szeged, 2002. 257-264 o. LENGYEL IMRE (2003): Verseny és területi fejlıdés: térségek versenyképessége Magyarországon. JATEPress, Szeged LENGYEL IMRE - RECHNITZER JÁNOS (2004): Regionális gazdaságtan. Dialóg-Campus, Budapest-Pécs, 2004. MEZEI ISTVÁN (2005): A szlovák-magyar határ menti kapcsolatok jelentıségérıl. ÉszakMagyarországi Stratégiai Füzetek, 2. évf. 1. sz. / 2005, 1-21 MOLNÁR T. (2001): Regional Characteristics of Social and Economic Structures in Western Transdanubia. Journal of Central European Agriculture, Vol 2. No.1-2, 17-26. MOLNÁR, T. (2006): Factors influencing development level of settlements in SouthTransdanubia. Journal of Central European Agriculture, Vol 7. No.4 (in press). MOLNÁR T. - BARNA K. - KOVÁCS B. (2003): A Dél-Dunántúli régió településeinek fejlettségi vizsgálata. Acta Scientatium Socialium, No. XIV.. 61-75. MYRDAL, G (1957): Economic Theory and Underdeveloped Regions. Dckworth & Co., London NEMES NAGY JÓZSEF (1998): A tér a társadalomkutatásban. Hilscher Rezsı Szociálpolitikai Egyesület, Budapest, 1998 NEMES NAGY JÓZSEF (szerk.) (2005): Regionális elemzési módszerek. Regionális Tudományi Tanulmányok, 11. kötet, ELTE Regionális Földrajzi Tanszék, Budapest, 2005. http://www.elte.georgr.hu NORTH, D. C. (1955): Location Theory and Regional Economic Growth. The Journal of Political Economy, No.3, pp 243-258. OHLIN, B. (1933, 1961, 1967): Interregional and International Trade. (Hungarian edition: Interregonális és nemzetközi kereskedelem) Közgazdasági és Jogi Kiadó, Budapest, 1981. Ó MAOLÁIN, CIARÁN (2000): North-South Co-operation on Agriculture and Food including forestry and rural development. A Mapping Study. 5 April 2000 . letöltés: 2006.június) PÁL ÁGNES (2002): Héthatáron. JGYF Kiadó, Szeged, 2002. PÁL ÁGNES- NAGY IMRE (2002): Társadalmi-gazdasági folyamatok a magyar-jugoszláv határmenti térségben. In: Pál Ágnes: Héthatáron. JGYF Kiadó, Szeged, 2002, 229-246 o. PÁL ÁGNES – VÖRÖSMARTINÉ TAJTI ERZSÉBET (2002): A határmentiség földrajzának fogalomrendszere. In: Pál Ágnes: Héthatáron. JGYF Kiadó, Szeged, 2002, 13-25. PAPP A. (1998): Néhány gondolat a a speciális területek kutatásairól. In: A sajátos helyzető térségek terület- és településfejlesztési problémái. MTA RKK, Pécs, 1988, pp. 158-159. PERROUX, F. (1964): Nemzeti függetlenség és kölcsönös gazdasági függés. KJK, Budapest PORTER, M.E. (2002): Competitiveness and the Role of Regions. Institute for Strategy and Competitiveness. Harvard Business School, Boston. PROBÁLD FERENC (2000): Európa regionális földrajza. ELTE Eötvös Kiadó, Budapest, 2000. RADÁCSI IMRE (2005): Regionális együttmőködések a határmentén - Egy magyar–szlovák határ menti térség esete. Kisebbségkutatás, 2005. 1. szám
240
RECHNITZER JÁNOS (1990). A nyitott határ. (A gazdasági és szellemi erıforrások innovációorientált fejlesztése az osztrák-magyar határ menti régiókban), MTA RKK ÉszakDunántúli Osztály, Gyır. 195 RECHNITZER JÁNOS (1997). Eurorégió vázlatok a magyar-osztrák-szlovák határ menti térségben. Tér és Társadalom 2. 29-54 RECHNITZER JÁNOS (1998): A területi stratégiák. Dialóg-Campus Kiadó, Budapest - Pécs RECHNITZER JÁNOS (1999). Határ menti együttmőködések Európában és Magyarországon. Az osztrák-magyar határ menti együttmőködés a kilencvenes években. In: Elválaszt és összeköt - a határ (szerk.: Nárai M.- Rechnitzer J.), MTA Regionális Kutatások Központja, Pécs-Gyır, 9-72, ill. 73-127. p. RECHNITZER JÁNOS (2001): Szerkezeti változások a regionális gazdaságban. Pécs, PTE KTK, MAFWM (2004): The SAPARD Programme – Agriculture and Rural Development Plan, 20052006., Republic of Croatia, Ministry of Agriculture, Forestry and Water Management RICHARDSON, H.W. (1969): Regional Economics. Weidenfeld and Nicolson, London. SAHLINS, PETER (1989): Boundaries: The Making of France, Spain in the Pyrenees. University of California Press. Berkeley. SALA-I-MARTIN, X (1996a): The classical approach to convergence analysis. The Economic Journal. No. 437. pp. 1019-1036. SALA-I-MARTIN, X (1996b): Regional cohesion: evidence and theories of regional growth and convergence. European Economic Review. No.6., pp. 1352-1362 SCHÜRMANN, C. - TALAAT, A. (2000): Towards a European Peripherality Index, IRPUD, Dortmund, http://www.inforegio.org/wbdoc/docgener/studies/ pdf/periph.pdf SCHUMPETER, J.A. (1939): Business Cycles. McGraw-Hill, New York; London. SCOTT, J. (1996) : Dutch-German Euroregions: A model Transboundary Cooperation. Border Regions in Functional Transition: European and North American Perspectives. Scott, J., Sweedler, A., Ganster, P., Eberwein, W-D. (eds.), IRS. Berlin, 83-107 SCOTT, JAMES (1999): Comprehending Transboundary Regionalism: Developing an Analytical Domain for Comparative Research. paper presented at the RSA International Conference 1999: "Regional Potentials in an Integrating Europe". http://www.irsnet.de/berichte_3.htm (18.02.2002) SEERS, D. (1979): The Periphery of Europe. In: D. Seers, B. Schaffer and M.-L. Kiljunen, eds.: Underdeveloped Europe: Studies in Core-Periphery Relations, pp. 1-35. London: Harvester. SIMAI MIHÁLY – GÁL PÉTER (2000): Új trendek és stratégiák a világgazdaságban. Akadémiai K. 2000. SPIEZIA, VINCENZO (2003): Measuring regional economics. Statistics in Brief, OECD, No. 6., October 2003 SOLOW, R. (1956): A contribution to the theory of economic growth. Quarterly Journal of Economics, 70. 65–94. o. SÜLI-ZAKAR ISTVÁN (2002): A határok és a határmentiség szerepe a területfejlesztésben. In: Pál Ágnes: Héthatáron. JGYF Kiadó, Szeged, 2002.,71-92 TÓTH J. (1996): A Kárpát –medence és a és a nemzetközi regionális együttmőködés. In: Határon innen - határon túl (szerk.: Pál Á., Szónokyné Ancsin G.), JATE Gazdaságföldrajzi Tanszék, Szeged 27-43. VÁTI (2006a): A VÁTI honlapja, www.vati.hu, letöltés: 2006. augusztus VÁTI (2006b): Hungary-Croatia CBC Programme. Programming Document of Cross Border Cooperation between Hungary and Croatia for the Programming Period 2007-2013. Draft., VÁTI Nonprofit Company, Strategic Planning and Evaluation Directorate: 2006 augusztus. WATTS, JULIE (2003) : Mexico-U.S. Migration and Labor Unions: Obstacles to Building CrossBorder Solidarity. The Center for Comparative Immigration Studies, Working Paper 79, University of California, San Diego, June 2003 WEGENER, M. - ESKELINNEN, H. - FÜRST, F., SCHÜRMANN, C. - SPIEKERMANN, K. (2002): Criteria for the Spatial Differentiation of the EU Territory: Geographical Position. Forschungen 102.2, Bonn, Bundesamt für Bauwesen und Raumordnung. WOLFFHARDT, ALEXANDER - JOHANNES LUTTER (ed, 2005a): Modul 1 - Regionális turisztikai együttmőködés , Dél-Csehországi régió – Waldviertel (Silva Nortica Eurégió). Az Európai Bizottság „Határon átnyúló kezdeményezések a helyi és regionális hatóságok között a csatlakozó országokkal határos EU-régiókban“ címő program OPENING projektje, Jihočeská Silva Nortica JčSN - Grenzüberschreitendes Impulszentrum GIZ NORD,
241
Europaforum Wien, - Wallenberger & Linhard Regionalberatung GmbH, Stadt Wien, 2005 WOLFFHARDT, ALEXANDER - JOHANNES LUTTER (ed, 2005b): Modul 6 - Határon átnyúló terület és közlekedéstervezés. Az Európai Bizottság „Határon átnyúló kezdeményezések a helyi és regionális hatóságok között a csatlakozó országokkal határos EU-régiókban“ címő program OPENING projektje, Jihočeská Silva Nortica JčSN - Grenzüberschreitendes Impulszentrum GIZ NORD, Europaforum Wien, - Wallenberger & Linhard Regionalberatung GmbH, Stadt Wien, 2005 ZEMANKOVICS, F. - BACSI ZS. (2003): Ten Fallacies of Rural Development in Western and Southern Transdanubia, Hungary. Proceedings of the 16th European Seminar on Extension Education, p. 236-240.
242
