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Journal of International Relations and Development
Regions in the European Union
By Michael Keating
*
The New Regionalism
Regionalism has been a persistent feature of Western Europe since the territorial consolidation of the state system and the rise of the modern, interventionist state in the nineteenth century. The large states, especially, have gone through periodic bouts of territorial assertiveness, and national governments have been obliged to practice a variety of techniques for accommodating the demands of their various territorial interests. In the late nineteenth century, there was a wave of territorial protest, as the bureaucratic state penetrated territories which had formally enjoyed more or less informal measures of autonomy. After the First World War, there was another phase, coinciding with the upheavals in Eastern and Central Europe as the old empires disintegrated. Following the Second World War, governments across Western Europe put in place elaborate policies for regional development, aimed at exploiting the under-utilised resources of less-developed or declining regions, while integrating them into national economic, social and political systems. These policies, inspired by a technical and rather apolitical logic, sparked off reactions within many affected territories, as they encouraged people to articulate their demands within a territorial framework, and as the central state’s conception of modernisation and development collided with the aspirations of social movements within the territories concerned. As in the late nineteenth century, the central state’s modernisation policies by-passed traditional territorial intermediaries and so destabilised the system of territorial representation. Coinciding with cultural revivals in many peripheral regions, and the rise of new social movements, this helped spark off a wave of movements of regional and minority nationalist protest in the late 1960s and 1970s.
Each of these crises of territorial representation was followed by destabilisation as the state put in place new mechanisms for territorial management and intermediation. This was not because homogeneous national societies were established or territorial politics faded away, but rather because national governments had found new ways to accommodate territories, and because regionalist movements, for their part, had not succeeded in forging a programme linking their political, social and economic aims, or a stable support base (Keating 1988). In the 1970s, governments diffused regionalist movements by conceding regional autonomy (France, Italy, Spain, Belgium, the United Kingdom), while much of the impetus of the regionalist movements was absorbed by the parties of the social democratic left. Regional autonomy could be extensive, as in Belgium or Spain, minimal as in France or Italy, or fail altogether as in the United Kingdom. In Belgium, France and Italy, regional institutions were largely colonised by the existing territorial political elites, and in the latter two cases city leaders emerged as more important than those at regional level.
In the 1990s, Western European states are experiencing another wave of territorial assertion but, this time, the framework is provided not merely by the nation-state, but by the global market and the process of European integration. The nation-state has been weakened by a variety of factors that can be summed up under the heading of globalisation. In particular, global capital mobility means that they can no longer practice the diversionary industrial policies of the past, since any attempt at investment direction is likely to lead to capital flight. Global and European rules prevent the use of tariffs to protect vulnerable sectors and international competition leads governments to favour their most competitive sectors and regions. New thinking on regional development puts less emphasis on national diversionary policies, or on massive public investment in infrastructure, and focuses instead on the qualities of particular territories, including the quality of life, the environment, the capacity for innovation and networks among firms and public decision-makers (Stöhr 1990; Dunford and Kafkalas 1992; Storper 1995). The international market, modern communications technology and the individualisation of social life are sometimes presented as destroyers of territory as a principle of organisation (Badie 1995). Yet at the same time they encourage the emergence of new types of territorial action (Amin and Thrift 1994; Keating 1996a). Development itself is defined more broadly to include quality-of-life issues. The new development paradigm gives an important role to the construction of identities, of territorially-based systems of action, and territorial solidarities. These new regional systems of action are now placed more directly in confrontation with the international market (Courchene 1995) because the intermediary role of the state has been severely attenuated. So the new regionalism (Keating 1996b; 1998; Balme 1996) is no longer a phenomenon internal to states; rather the context is provided by the European Union (EU) and the global market.
European integration has implications both for the economics and the politics of regions. At one time it was hoped that the creation of a single market would itself serve to eliminate territorial disparities as investment flowed to regions of surplus labour and workers moved to where the jobs were. In practice, labour has proved less mobile, while capital has been attracted to areas which are already more prosperous. Consequently, integration has tended to exacerbate territorial disparities, though winners and losers are distributed across the continent in very complex patterns (Dunford 1994). The need to respond to the demands of the single market has spawned new regional development coalitions, bringing together local and regional governments with business leaders and, sometimes, trade unions and others. EU policies themselves have had a rather uneven impact. Again, this is a complex issue but, generally speaking, the agricultural and research spending has tended to favour the better-off regions. Politically, the EU was initially seen in many peripheral regions as even more remote than national governments (Keating and Jones 1995). It tended to have a centralising effect as it invaded issues of regional competence, which were then decided by national governments in the Council of Ministers. This produced anti-European feeling in many regions, especially in the European periphery. In the 1980s, this began to change, as regional politicians and social movements shifted from a strategy of opposition to Europe to one of constructive engagement, seeking ways to constitute themselves as actors within the new European polity (Jones and Keating 1995). This provided a further stimulus to regional mobilisation and the search for appropriate institutions. Since the late 1980s, the EU has served more directly to stimulate regionalism as it has expanded its own regional policy, limited the role of national governments in it, and sought partners within the regions themselves (Hooghe and Keating 1994; Hooghe 1996). Europe has also been invoked by minority nationalist movements within states and a new framework for self-government. In some cases, as in Scotland, the argument is that, within the EU, national independence is less costly and risky and that the old arguments about disrupting trading patterns or imposing customs posts at the border are now irrelevant. For others, such as the governing party in Catalonia, Convergència i Unió, Europe is evoked more vaguely as an arena for the projection of nationalist aspirations, without demanding independence. As a result of these trends, Europe and regionalism, previously rather disparate issues, are now closely connected in political debate.
Regions in the European Union
The conjunction of regionalism and European integration has produced a new type of politics and much talk of a Europe of the Regions (Bullman 1994; Jones and Keating 1995; Petschen 1993) as the state’s competences and power are eroded both from below and from above. Yet the nature of this new politics varies greatly, depending on the degree of institutionalisation of the regions themselves both as governments and in civil society. Regions have emerged in some cases as arenas for political debate, providing the focus for policy discussion and a framework for legitimate decision-making. In other cases, the existence of the region, its boundaries, or its legitimacy as a social unit are contested. In some cases, as in Germany, regions are highly institutionalised and integrated into the state system, while in others, such as the United Kingdom, there were until 1999 no political institutions at all at the regional level, just administrative agencies and the deconcentrated arms of the central state. In the more highly institutionalised regions, there is a greater capacity to mount a coherent development project and establish a common regional interest within the state and the EU (Keating 1996c).
Regions have a variety of channels of influence in Europe (Keating and Hooghe 1996) and their use of them reflects their interests as well as the opportunities open to them. The most important is through their national governments, using the same mechanisms of influence as they employ in domestic politics. So Belgium, Germany and Austria have reformed their federal arrangements to permit regional influence in the formulation of the state’s European policy and have invoked the clause in the Maastricht Treaty which allows subnational governments to represent the state in the Council of Ministers (Article 146). In France, the networks of personal influence have been extended into Europe (Balme 1995). In Spain, political parties provide a key link. Under the former Socialist government, Andalucia was protected as a critical support base, while the Catalan nationalists included European policies in their pacts with successive socialist and conservative national governments. In the United Kingdom, the Scottish and Welsh Offices represent their respective nations’ interests in negotiating European policy. These national systems do not always adapt themselves to Europe, however. The French tradition of rigidity in the rules and flexibility in the implementation cannot be applied to European regulations, which need to be enforced (Schmidt 1995). Germany’s legalistic and institutionally-oriented policy style does not adapt well to the new open-ended policy style of networks and continual negotiation (Tömmel 1996). Scottish and Welsh interests may be present in sectoral Councils on matters in which they are functionally competent, but they are likely to be sacrificed when trade-offs have to be made to reach package deals (Keating and Jones 1995).
A second mechanism for influence is through direct links. Many regions have established offices in Brussels, engage in lobbying and hire consultants to help them through the Brussels system. Since power remains concentrated in the Council of Ministers representing national governments, there is a limit to what can be achieved by direct contact, but it may enable regions to have advance notice of proposals under consideration, as well as enabling them to follow dossiers on particular projects through the Commission. National states have tended to resist these links and in Italy and Spain used legal and constitutional mechanisms to prevent them, but in both cases courts have now ruled that such representation is constitutional.
Thirdly, there are a variety of consultative mechanisms put in place by the EU itself or recognised by the Commission. The Assembly of European Regions represents regional interests broadly, and a range of more specialised bodies speak for regions of particular types. For the administration of the structural fund programmes, the Commission has insisted on partnership arrangements, including regional representatives. Finally, the Committee of the Regions (CoR), established under the Maastricht Treaty, has formal consultative status alongside the Economic and Social Committee. This is a weaker body than the more ardent regionalists desired and has to include both powerful regional governments, like the German Länder, and mere municipalities, in its membership. It has an important role in articulating the demands of the regions in discussions on institutional reform, for example in the preparation for the Intergovernmental Conference (discussed below) but on more precise policy and resource questions, regions are in competition with each other, and so tend to operate on their own, or in alliance with regions in a similar position.
The European Union and the Regions
The Commission has itself played an important role in mobilising regional interests, and establishing networks linking regions, states and itself. The main stimulus has been the EU’s regional policy, now subsumed under the structural funds, which now account for one-third of the EU budget, less than agricultural spending but far more than any other item. The development of regional and structural policy is the product of two converging logics (Hooghe and Keating 1994). On the one hand is a policy logic, pursued by the Commission. On the other hand is a political and distributive logic, located in the Council of Ministers and intergovernmental negotiations. The policy logic for an EU regional policy is similar to that for national regional policies of the 1960s and 1970s. It is a mechanism for rectifying the territorial disparities produced by market integration and for achieving allocative efficiency. It is a social compensation for losers in the process of economic restructuring and it is a device to legitimise the European project in regions where support might otherwise be lacking. The political logic is the need to redistribute resources among member-states. Initially, this meant compensating Britain for its disproportionately large net contribution to the Community budget in the 1970s. Later, the policy was extended to compensate the southern European countries for the effects of the single market programme. These different logics produced conflicts between the Commission and member-states from the inauguration of the European Regional Development Fund (ERDF) in 1975 (Mawson et al. 1985). To gain the consent of member-states, it was necessary to divide the ERDF into fixed national quotas and give all member-states a share. Eligibility for ERDF funding was dependent on whether a region was eligible for national regional policy aid, and this led to an effective nationalisation of the policy. Funds were administered by national governments, which almost invariably refused to treat them as additional to national spending but used them as a reimbursement to themselves for their own regional policy spending.
Persistently, the Commission sought to increase its own influence over the framing and implementation of the policy, to convert it to a genuine instrument of regional policy, and to ensure that spending is additional to national spending programmes. From the late 1980s, it also sought to co-opt regional interests as partners in designing and implementing programmes. This has produced a three-level contest for control of the policy instrument, among the Commission, member-states and regions themselves. A major reform, in 1988, was again guided by the political necessity to compensate the countries of Southern Europe and Ireland for the adoption of the single market programme measures in the period to 1993, and by the Commission’s desire to convert the ERDF and other structural funds into a genuine policy. The funds were doubled and the three main ones, the ERDF, the European Social Fund (ESF) and the Guidance Section of the European Agricultural Guidance and Guarantee Fund (EAGGF) brought together (Armstrong 1995). Five objectives were laid down, three of which are regional in nature. The Commission was to draw up its own map of eligible areas, using Community-wide criteria. Funds were to be disbursed only to projects within approved Community Support Frameworks (CSFs), apart from 9 percent, which was reserved for Community Initiatives sponsored by the Commission. CSFs were to be negotiated between the Commission and member-states, with the involvement of regions themselves. Within these, programmes of action were to be framed and administered by partnerships involving Commission representatives, national governments, and representatives from the regions. Additionality was laid down as a general principle, so that spending would have to be over and above national spending. The whole policy was to be guided by the principle of subsidiarity, with the greatest possible involvement of regional and local interests and the social partners in the world of business, labour and voluntary groups. The Commission, in line with contemporary thinking on development policy, also sought to move from infrastructure to human capital, productive investment and endogenous development, giving opportunities for a more active and participatory role for regional actors of various sorts.
This should have encouraged greater regional involvement in policy making and stronger direct links between the Commission and regional interests, and to some extent this has happened. States without regional structures have had to create them, or a least some substitute for them, in order to be eligible for funds—for example in Greece, Ireland and Sweden. The new funds have stimulated a great deal of political mobilisation (Hooghe 1996) even in places like England, without a developed regionalism (Burch and Holliday 1993). There has been an explosion of regional lobbying and offices in Brussels. Regional actors have been brought into contact with Commission officials and its thinking on development policy has been diffused through the mechanism of partnership.
Yet while there has been a great deal of noise around the new relationships, the substantive changes should not be exaggerated. We are not witnessing a new territorial order, in which regions are independent actors alongside national governments. For one thing, the Commission itself does not have a consistent definition of what is a region. Its NUTS table (Nomenclature of Territorial Units for Statistics) consists of three levels, each of which is a mere aggregation of national administrative units. Nor does it limit itself to regional authorities, however defined. Some its initiatives involve municipal governments. Others are aimed at the private sector or local action groups within civil society. The Commission’s objective is not to restructure the map of Europe, but to get programmes going, to spend the funds in the most effective way possible, and to involve whatever partners are appropriate for the task at hand.
National governments have also found their way back into the game. While the Commission has succeeded in concentrating funds on the neediest regions, there is still a need to make sure that everyone gets something in order to keep national governments on side. Even the new Scandinavian members, although net contributors to the EU budget, had to get a share of the structural funds, so a new objective 6 was designed, for areas of sparse population. While there are officially no national quotas, there is an understanding that Britain, for example, will get a large share of the funds for industrial areas, while France will do well in the rural category. The map of eligible areas is negotiated between states and the Commission, a practice that was formalised in 1993 and pressure is exerted by member-states to include areas that fall outside the eligibility criteria. CSFs are nationally based and negotiated bilaterally with the Commission. In the 1993 changes, it was made possible for states to submit a single document including their overall development plan and the individual applications for assistance, rather than having to have the former approved first. Partnership in the CSFs is decided by member-states and this too was formalised in 1993, though the Commission has sought to make it as inclusive as possible.
Like national regional policies before them, then, the EU’s initiatives through the funds have stimulated a great deal of territorial mobilisation, but this varies among member-states. Where a national government has taken a permissive stance or been unable to control regional activity, regions have become important actors. In other cases, strong states have largely retained their monopoly on links to the Commission and control of regional policy implementation. At one extreme are the Belgian regions, which deal directly with the Commission on the designation of eligible areas, the allocation of the funds, negotiation of the contracts and implementation. They are not, however, involved in negotiations on changes in the fund regulations, such as those brought about in 1993. The German Länder are also deeply involved, through the mechanisms of co-operative federalism. Individual Länder participate in the design and implementation of CSFs, through the Joint Tasks Framework ( Gemeinschaftsaufgabe) (Anderson 1996). At the other extreme are Greece, Ireland and Portugal, which lack a regional tier of government although, in response to Commission prompting, they are starting to put mechanisms in place. In France and the United Kingdom, there has, paradoxically, been some increased centralisation since the 1988 reforms, as the structural funds have become financially significant and politically more salient (Balme 1995; Keating and Jones 1995; Balme and Jouve 1996).
Another mechanism for the organisation of subnational interests is networking. A range of Commission initiatives encourages networks and partnerships among cities and regions. The INTERREG programme stimulates cross-border co-operation. These are in addition to the large numbers of European-wide organisations for regions, ranging from the general-purpose bodies like the Assembly of European Regions, through functionally or territorially-defined associations like the Assembly of Peripheral Maritime Regions, or the association of Regions of Industrial Technology, to partnerships like the Four Motors of Europe, which links four regions which are the technological leaders in their respective states (Baden-Württemberg, Rhône-Alpes, Lombardy and Catalonia). These, too, take the regional question out of the nation-state framework, and place in it a European context.
Future Prospects
The future of regions within the EU depends very much on the future of the EU itself, with regard both to institutional deepening and to widening by the inclusion of new members (Pintarits 1996; Keating and Pintarits 1997). A tightly integrated Union, albeit including only a core of members, could further erode the nation-state and encourage regional assertion. The single currency marks a qualitative shift of power from national governments to the European level and further reduces states’ capacity for autonomous macro-economic steering. This will further enhance the importance of supply-side measures, including infrastructure, training and labour market policy, in the adaptation of territories to the European and global markets. Many of these are matters of regional and local responsibility and this will increase the importance of the EU-regional dialogue. A looser arrangement, with only incremental change, could allow a more differentiated order, in which states and regions continued to coexist. Strong regions could improve their position within the Union and those states that contain territorial/national fault lines (like the United Kingdom, Spain and Belgium) could see a persistence of territorial tensions. Elsewhere, nation-states would retain control of territorial politics. A failure to maintain the progress of integration or a collapse of the single currency, on the other hand, could encourage a denationalisation of territorial politics, with nation-states regaining control of the game and regional interests focusing their attention on their national political systems.
In the preparation for the Intergovernmental Conference preceding the Amsterdam Treaty a number of demands were made by regional interests. The CoR demanded that the subsidiarity principle be revised to make explicit reference to the role of regions and local authorities; that it and the regions should have the right of recourse before the European Court of Justice where the principle is violated; that the Committee be made a full European institution and be separated from the Economic and Social Committee; that its consultative function be widened to include more policy areas, and the European Parliament; that it be involved more in drawing up legislative programmes; and that the principles of local autonomy and the need to promote cross-border co-operation be spelled out in the Treaty. Some regionalists went a great deal further, advocating that the CoR become in effect a legislative chamber. None of these ideas were adopted, although the CoR did gain a consultative role in a wider range of matters. This marks a setback to the strategy of constituting the regions as a ‘third level’ of the EU with a well-defined role, a strategy associated above all with the German Länder (Jeffery 1996). In the absence of this, regions must continue to press for recognition wherever there is an opportunity, using the whole gamut of strategies outlined above and still depending to a large extent upon openings in their national political structures.
Enlargement presents a more serious challenge, since it will increase the extent of regional disparities dramatically. There is little prospect of a substantial increase in the structural funds, since the net contributor countries are not willing to pay more. This means that the existing funds must be stretched further. If the present regime were extended to the countries of Central and Eastern Europe, they could claim the entire budget and more, depriving the present beneficiaries in Southern Europe. It is likely that this question will be fudged, by phasing in eligibility on the grounds that new members could not absorb the huge sums to which they might be entitled. Better off countries among the existing members, including France, Italy and the United Kingdom, will likely see their shares of the funds fall further, while Spain and Ireland could also see sharp reductions. Grants may also increasingly be converted into repayable loans.
Enlargement will increase disparities within the EU dramatically and this will bring further strains between and within countries. Already, countries of Central and Eastern Europe are adopting regional administrative structures in order to conform with Commission recommendations. Yet the reality of regions is, if anything, even more diverse than in Western Europe and some of these regional structures may prove artificial. Enlargement will also introduce into the Union disparities much greater than those it has known to date, while the dynamic of market integration may serve to accentuate them. Those regions in Central and Eastern Europe that are closer to the west will be better placed to take advantage of the new market access than those further to the east. This could produce strains in Poland and, beyond the borders of the enlarged Union, in Ukraine. The result could be an anti-European backlash in the peripheral territories and a resurgence of populist nationalism. Similar oppositions around the peripheral parts of Western Europe were assuaged, and eventually turned into constructive engagement and dialogue, with the aid of the structural funds. Funding has been earmarked for new and prospective members, but not on a scale consistent with the problems. Indeed the wealthier countries that are net contributors to the EU budget have made it clear that, far from agreeing to massive increases in EU transfer spending, they are seeking retrenchment. This could make regional adjustment in Central and Eastern Europe both difficult and conflictual.
European integration has been a powerful stimulus to territorial mobilisation in Western Europe, but at the same time it has provided new mechanisms to manage the consequences. The erosion of state sovereignty and the sharing of power that it imposes allow a more flexible constitutional order in which questions of jurisdiction do not become absolutes but can be negotiated. In multinational states like Spain, Belgium and the United Kingdom, this has permitted a programme of decentralisation and a degree of recognition of the special needs of particular areas, within the overall framework of Europe. It has also modified the strategies and aims of separatist movements, which now almost invariably place their demands in the context of a united Europe, sometimes seeking independence within the EU but more often seeking a new political order in which state sovereignty is shared with other territorial levels (this is the strategy notably of the already mentioned Catalan nationalist party Convergència i Unió). Europe provides three advantages to national minorities pursuing these new strategies. First, it undermines the concept of state sovereignty from above, giving credence to those challenging it from below. Second, it gives a set of possibilities, albeit limited, to operate in the European political system through the mechanisms of regional representation. Third, and perhaps more importantly, it creates a new discursive space within which non-state nationalities can project themselves symbolically as being more than mere sub-units of states. This emerging model, of diffused sovereignty and recognition of difference, offers important lessons to the wider Europe that has been emerging from the end of the Cold War. It may be that a regionalised Europe will offer new possibilities for autonomy and recognition for national and ethnic minorities in Central and Eastern Europe but only if the challenge of enlargement can be met and the resources to allow it made available.
February 1999
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*: The present article draws on work I have done previously, on my own and in collaboration with Liesbet Hooghe (Hooghe and Keating 1994; Keating and Hooghe 1996) and with Sylvia Pintarits (Keating and Pintarits 1997) as well as contributions to the edited volume by Jones and Keating (1995). Back.
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*: Michael Keating is Professor of Political Science at the University of Western Ontario, Social Science Centre, London; and Visiting Fellow at the European University Institute, Florence. Back.