STRUCTURAL F U NDS OF THE EUROPEAN UNION IN POLAND EXPERIENCES OF THE FIRST PERIOD OF MEMBERSHIP

1. Paweł ChurskiInstitute of Socio-Economic Geography and Spatial Management, Adam Mickiewicz University, Poznań, Poland. University of Humanities and Economics in Wloclawek, Polande-mail: chur@amu.edu.plhttp://www.churski.pl STRUCTURAL FUNDS OF THE EUROPEAN UNION IN POLAND EXPERIENCES OF THE FIRST PERIOD OF MEMBERSHIP

2. The main aim of my presentation is the analysis of the absorption of Structural Funds during the first period of membership in the EU . The obtained results form an attempt to answer the following question: Is the chance – created by the accesible Structural Funds – applied efficiently in Poland can create an important factor for regional development ?

3. PRESENTATION OUTLINEConsidering the time limits, I would like to discuss briefly two major subjects connected with the topic areas of my paper: • Part IRegional differences in Poland • Part IIAnalysis of the absorption of Structural Funds in Poland during the period: 1st May 2004 – 31st March 2006

4. Part IRegional differences in Poland

5. REGIONAL DIFFERENCES IN POLAND The changes of regional differences in Poland will be presented considering two following aspects: • Administrative-territorial organisation of Poland • The regional differences factors in Poland

6. Regional differences in PolandAdministrative-territorial organisation of PolandThe territorial division of Poland that has been in force since 1 January 1999 is based on a new, three-tier model: the commune, the poviat, and the voivodeship,working on the principles of decentralisation and self-government.

7. Regional differences in PolandThe regional differences factors in Poland Foreign investment in Poland (cf. Domański, 2001)

8. Regional differences in PolandThe regional differences factors in Poland Commercialisation of agriculture in Poland (cf. Kulikowski, 2005)

9. Regional differences in PolandThe regional differences factors in Poland The synthetic measure of socio-economic developmentwidely employed in analysesof regional differences is per capita GDP. The range of variations in the index for the Polish voivodeships (NUTS 2 units, 2002 data) is 1:2.1.

10. Part II Analysis of the absorption of Structural Funds in Poland during the period: 1st May 2004 – 31st March 2006

11. Structural Funds in PolandBasis of absorption Joining the European Union has made Poland eligible for much more generous EU financial assistance for regional policy measures than in the pre-accession period. However, this entails the adoption of Structural Funds procedures and principles, including the programming principle, that are new in the Polish conditions. As a new member, Poland has drawn up a strategic document, The NationalDevelopment Plan, 2004-2006, adopted by the government on 15 January 2003. It has been prepared in accordance with the provisions of the EU Council Regulation No. 1260/1999. The National Development Plan, 2004-2006 was submitted to the European Commission for approval. As a result of the negotiations conducted, on 31 July 2003 an agreement was reached on the structure of the Community Support Framework.

12. Structural Funds in PolandAims and functions The strategic objective of National Development Plan is to develop competitveness of Polish economy based on knowledge and enterpreneurship, and capable of harmonious growth to ensure an increase in employment and improvement of social, economic and space cohesion between Poland and the EU on the regional and national levels. It is assumed that implementation of the strategic objective will be possible through completion of its smaller parts which have been defined in the following way (cf. Narodowy Plan…, 2003): • creating grounds for obtaining a sustainable, high level of GDP, • increasing the level of employment and education, • incorporating Poland into the European network of transportation and information infrastructure, • intensifying the process of increasing the participation of high value-added sectors in the economy, • developing the technology of information society, • providing support for the participation of all regions and social groups in Poland in the development and modernisation processes.

13. Structural Funds in PolandBudget The budget of the Community Support Framework in Poland in the years 2004-2006 taking into acount all sources of financing amounts to over 18.2 billion EUR. Within the above stated amount Structural Funds form 8,275.8 mln EUR which makes up for 72.2% of the involved public resources and 45,6% of the total budget. The other sources of financing include: • national resources, i.e. national budget and local governments budgets, • private financial means, • the support for Community Initiatives INTERREG and EQUAL, • the support of the Cohesion Fund.

14. Structural Funds in PolandBudget

15. Structural Funds in PolandPresent state and structure of absorption – the acquired resources Between May 2004 and the end of March 2006 value of applications for cofinancing from Structural Funds exceeded 15,600 million EUR, which constitutes 181.6% of these allocations for the whole programming period of 2004-2006. The submitted applications have undergone a verification and evaluation procedure aimed at rejecting the projects containing formal errors and selecting the best ones of the entire pool. As a result, applications for EU funding of the total amount of over 5,900 million EUR, which corresponds respectively to 68.3% for the entire programming period for 2004-2006, have been qualified to the second stage of the scheme i.e. decisions on granting financing and signing contracts. The tangible effect of the support and proof of the project’s implementation is the flow of funds between the programming accounts and beneficiaries, constituting the partial refund of the project cost. By the end of March 2006 the amount slightly exceeding 1,000 milion EUR, which is approximately 11.7% of funds from the Structural Funds programmed for Poland in the period of 2004-2006, had been transferred out of programming accounts in favour of Polish beneficiaries.

16. Structural Funds in PolandPresent state and structure of absorption – the acquired resources

17. Structural Funds in PolandPresent state and structure of absorption – regional differences

18. Structural Funds in PolandPresent state and structure of absorption - beneficiaries • The analysis of the structure of beneficiaries of the Structural Funds in Poland contains the following structure: • units of local authorities, • entrepreneurs, • NGOs, • educational and research-oriented establishment: higher education institutions, training institutions, research centres. • Data covers period from May 1, 2004 until July 31, 2005 • Due to limited time I will present only the chosen results regarding first of all the regional differences in the acquired support set by beneficiaries.

19. Structural Funds in PolandPresent state and structure of absorption – beneficiaries LOCAL AUTHORITY UNITS • Number of concluded contracts - 2323 • Value of co-financing the Structural Funds - 1,414.2 mln euro • Participation in the general amount of acquired support - 43.0% • Structure of intervention of Structural Funds: • investment in the basic infrastructure - 86% • projects supporting the development of human resources - 12% • projects supporting the production sector - 2% • Regional differences: • the biggest support obtained by the economically strongest regions with capital cities in big metropolitan areas: mazowieckie voivodship with Warsaw, wielkopolskie voivodship with Poznań and pomorskie voivodship with the Tri-city. • the lowest support acquired by the regions of the so-called ‘eastern wall’ and regions of the advanced process of restructuring of traditional industries, i.e. Łódź voivodship – the biggest area of textile industry in Poland.

20. Structural Funds in PolandPresent state and structure of absorption – beneficiaries LOCAL AUTHORITY UNITS

21. Structural Funds in PolandPresent state and structure of absorption – beneficiaries ENTERPRISES • Number of concluded contracts - 1341 • Value of co-financing the Structural Funds - 210.5 mln euro • Participation in the general amount of acquired support - 6.4% • Structure of intervention of Structural Funds: • physical infrastructure – buildings and equipment - 50% • food processing and marketing of agriculture products - 30% • environmental protection - 10% • Regional differences: • the biggest support obtained by the regions with the big industrial areas:śląskie voivodship and łódzkie voivodship • the lowest support acquired by the regions of the so-called ‘eastern-wall’ and southern regions

22. Structural Funds in PolandPresent state and structure of absorption – beneficiaries ENTERPRISES

23. Structural Funds in PolandPresent state and structure of absorption – beneficiaries NGO’s • Number of concluded contracts - 281 • Value of co-financing the Structural Funds - 204.7 mln euro • Participation in the general amount of acquired support - 6.2% • Structure of intervention of Structural Funds: • training and counselling projects - 85% • support for the increase of competitiveness of companies - 6.0% • support of the developing potential of regions - 6.0% • Regional differences: • the biggest support obtained by mazowieckie, wielkopolskie and lubelskie voivodships • the lowest support acquired by świętokrzyskie, kujawsko-pomorskie and podlaskie voivodships

24. Structural Funds in PolandPresent state and structure of absorption - beneficiariesNGO’s

25. Structural Funds in PolandPresent state and structure of absorption – beneficiaries EDUCATION AND SCIENCE • Number of concluded contract - 426 • Value of co-financing the Structural Funds - 197.7 mln euro • Participation in the general amount of acquired support - 6.0% • Structure of intervention of Structural Funds: • infrastructural projects improving conditions of the realization of didactic process • projects increasing the availability of the non-free forms of education and professional development • the construction and update of the research labs • Regional differences: • the biggest support obtained by mazowieckie, wielkopolskie and śląskie voivodship • the lowest support acquired by the regions of so-called ‘eastern wall”: warmińsko- mazurskie, podlaskie and lubelskie voivodships

26. Structural Funds in PolandPresent state and structure of absorption – beneficiaries EDUCATION AND SCIENCE

27. SUMMING UP • Results of the conducted analysis lead to the following conclusions: • Progress in absorption of the Structural Funds in Poland, particularly due to significant acceleration of pace in the last six months, should be evaluated positively. With the obtained support in the form of the amount of contracts concluded of the total value of 5,900 million EUR, corresponding to 68.3 % of the total EU funds allocated for 2004-2006, Poland maintains an average level of new member states of EU, surpassing Lithuania (47.9%), Slovakia (46.5%) and the Czech Republic (45.8%). • Comparing the value of payments transferred by the European Commission to the old member states at the end of 2001, or the first two years of the current financial policy 2000-2006, it has to be observed that they remained at much lower level than the payments received by Poland and other new member states. • Distribution of EU support, both on the national scale and in the specific groups of beneficiaries, focusing on the restructuring and modernisation of agriculture, the improvement of infrastructure, the development of the competitiveness of economy and quality of human resources correspond the priorities of the EU and Polish economy policy. • Regional distribution both in terms of the entire support as well as in specific groups of beneficiaries does not show any tendencies to concentrate itself on the least developed regions. The highest number and value of projects cofinanced from the Structural Funds can be observed in the best-economically developed voivodships with their capital cities in big metropolitan areas: mazowieckie with Warsaw, wielkopolskie with Poznań. Unfortunately, in the regions with high level of structural unemployment (e.g. warmińsko-mazurskie), undergoing the process of the restructuring of traditional industry (e.g. łódzkie), and with high concentration of small, individually-owned farms (e.g. podlaskie, świętokrzyskie), the level of activity observed has to be considered unsatisfactory and indicating too little evidence adequate absorption of EU support available through the Structural Funds

28. Paweł ChurskiInstitute of Socio-Economic Geography and Spatial Management, Adam Mickiewicz University, Poznań, Poland. University of Humanities and Economics in Wloclawek, Polande-mail: chur@amu.edu.plhttp://www.churski.pl STRUCTURAL FUNDS OF THE EUROPEAN UNION IN POLAND EXPERIENCES OF THE FIRST PERIOD OF MEMBERSHIP Thank you for your attention !