Malta's economic success means less funds from the EU - October 17, 2011

Malta will receive less funds in the forthcoming EU budget but this should be interpreted as a sign of success for the country, the EU's  Regional Policy Commissioner Johannes Hahn, said this afternoon.

Speaking after a meeting with Prime Minister Lawrence Gonzi at the Auberge de Castille, Mr Hahn said the aim of European regional and cohesion funds was to reduce disparities between the regions.

“The objective of the policy is to help poor regions and Malta is no longer a poor region,” he said when asked whether Malta was being penalised for its success in using EU funds.

Economic statistics show that Malta no longer qualifies for Objective One status, which is the highest level of EU funding a country can achieve.

However, under proposals put forward by the Commission for the forthcoming 2014-2020 budget a new status would be created for regions in transition. Malta will likely benefit from this status but it will still mean a lower level of funding than the country has enjoyed until now.

Commissioner Hahn said he was impressed by Malta’s absorption of funds, which was above the EU average.

Asked about the Commission’s proposal for an EU-wide financial transactions tax, Mr Hahn said Brussels was aware of concerns raised by some member states including Malta.

However, he insisted that any discussions on the matter should retain the principle that EU institutions should also have their own resources to fund operations.

Mr Hahn said he was impressed by Malta's use of EU funds on, among others - the sewage treatment and waste treatment plant projects, and he looked forward to the use of such funds on the building of the new Mcast campus.

Malta's absorption rate, he said, was above the EU average. He however understood the call expressed by Malta for a simplification of the application procedures, especially when entities such as SMEs need to apply for funds.

While in Malta, Mr Hahn attended a meeting of the auditors of EU structural funds.

During the meeting, Finance Minister Tonio Fenech said that since it joined the EU, Malta had been allocated a billion euro in Structural and Cohesion Funds.

The minister said that the 2004-2006 Structural Funds allocated to Malta were fully absorbed. The 2007-2013 Programmes are well underway and are expected to reach over 80% commitments by the end of this year.


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