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To What Extent Is The Economic Development Of The Accession Countries Likely To Be As A Result Of Eu Regional Policy?

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The ten accession countries joined the EU on 1st May 2004. The countries are: Cyprus, Slovenia, Malta, Czech Republic, Hungary, Poland, Slovakia, Estonia, Lithuania and Latvia. There are a number of ways in which the economies of the accession countries differ to those of the EU fifteen. Firstly, all of the accession countries have larger agricultural sectors than that of the EU fifteen. On average, 20% of the accession countries labour force is employed in agriculture compared to an average of 4% for the EU fifteen. Also, on average, accession countries have smaller economies and lower incomes per head. EU regional policy aims to reduce the differences between the countries. This may be done in a number of ways, for example, through subsides and increased public expenditure by the ECB. It can be argued that EU regional policy is responsible for economic development in the accession countries. However, there is also evidence to show that economic development has occurred due to factors other than EU regional policy.

One the one hand, it is likely that the economic development of the accession countries is likely to be as a result of EU regional policy. One reason for this is that the countries would be entitled to receive financial support from the CAP (Common Agricultural Policy) and from the EU's structural funds. The objectives of CAP are: to increase agricultural productivity, to ensure a fair standard of living for the agricultural community, to stabilise agricultural markets, to make the area or country self-sufficient in agricultural products and to ensure affordable prices for consumers. These objectives should help those in the agricultural sector to enjoy a higher level of income per head. EU regional policy aims to promote equity and fairness, and this may be done by allowing all of the EU countries to have access to a very large market. This would help the accession countries develop as they will be able to sell goods and services to a market of more than 450 million people, many of whom enjoy high incomes. This could help in widening the size of the accession countries' economies, and eventually reduce the regional divide. Being part of a wider market will also help the accession countries to be more efficient. This is because being part of a single market will mean that there is increased competition between the member countries. In order to compete with the other EU countries; accession countries' firms will have to modernise and increase their performance. For example, they will need to increase the productivity and quality of the goods and services that they produce. EU regional policy treats each region on an assessment of their economic and social needs. So, the accession countries are likely to receive greater help and funding so that their economies can grow and develop.

Another aim of EU regional policy is to promote economic efficiency. As this should lead to a more balanced regional economy in Europe, employment opportunities should also increase. This should result in rising incomes and greater trade within and between regions, leading to a faster rate of economic growth in the long run. Another EU regional policy is concerned with population movement. This allows the free movement of labour within the EU. It is likely that this will help reduce the differences in employment between the EU fifteen and the accession countries. Another way in which accession countries may have been helped is by receiving European Union subsides. An example of how subsides can help a country if of Ireland; subsides from the EU



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