EU Funds in CEE Since the CEE countries became the EU members, EU co-financing has become an essential factor for they development.

EU Funds in CEE 2007-2013

Funds which support Common Agriculture Policy and the Common Fisheries Policy in UE Eurpean Agricultural Fund for Rural Development (EAFRD) Improves management and controls the rural development European Agriculture Guarantee Fund (EAGF) Direct payments for farmers European Fisheries Fund (EFF) Support common fisheries policy Sustainable use of marine resources

Allocation of EU funds by countries EU funds per capita in CEE countries, 2007-2013 The amount of allocated EU funds varies by country; The most is allocated for Poland, which has the biggest population. The highest EU fund per capita is in Czech Republic, Estonia, and Hungary.

General information on progress in spending EU funds

The main purpose of contracted EU funds in CEE The majority of grants – 73% of total contracted grants have been contracted for transport, human recourses development, economic development, and environment related projects.

The main spending in CEE-6

Assuming the CEE-6 would manage to absorb 90% of newly allocated funds, this would add 0.3-9.8 pp to the annual GDP growth

EU fund will contribute positively to growth

New challenges for 2015-2025

Investment in hard infrastructure Cohesion Funds (2014-2020), 167bn EUR Connecting Europe Facility Program (33bn EUR). Biggest recipients: Romania - up to 24 bn EUR can be invested in the road network to 2030; Poland – 27.5 bn EUR in infrastructure; Czech Republic – 9bn EUR infrastructure Investments.

Investments into energy security and energy efficiency CEE countries need to decrease intensity of energy consumption. (lack of modern technology) The need to increase spending on alternative sources of energy.

Investments into military equipment Investment in and purchasing Military equipment squeezed in CEE so far.

Improvement in quality of public institutions

Introduction of life-long learning system Share of population age 18-64 in education & training vs. the spending on education as % of spending EU-28 in 2012. Total spending on all education as % of GDP vs. EU-27 average 2002-2010

Boost the spending on R&D in innovative sectors like ICT sector R&D spending as % of GDP in 2012 Value of IT sector in CEE in EUR mln

CEE faces big demographic challenge Working -age population has been shrinking (15-64), 2013=100 Activity rate- necessary to keep labor supply constant – needs to increase