Ireland’s northern and western region to be designated as ‘more developed’, meaning millions of euro less funding per year
The Commission confirmed the new designation for the next EU funding period, which runs from 2028 to 2034, in an official document sent to the Northern and Western Regional Assembly (NWRA), its economist John Daly said.
The assembly is the region’s managing authority for the European Regional Development Fund, which transfers money from the EU’s richer regions and invests it in the infrastructure of the bloc’s poorer regions by co-financing investments with the member states’ national governments.
Because the border counties will be categorised as “more developed”, the rate of EU co-financing of infrastructure projects will drop to 40pc from 60pc from 2028. This means, for instance, that if a €100m project is taking place in Donegal, it would receive €40m instead of €60m from the EU – and the Government would have to fund the gap.
“This will make it less appealing for Government to fund a project,” Mr Daly said. “Border counties will suffer as a result.”
The NWRA, one of three regional assemblies in Ireland, is tasked with supporting economic development in Galway, Mayo, Roscommon, Sligo, Leitrim, Donegal, Cavan and Monaghan.
The region was classified by the Commission as a “transition region” for the current funding round, from 2021 to 2027, as it had a GDP per capita of between 75pc and 100pc of the EU average in the years 2015, 2016 and 2017.
NWRA GDP per head of population has since increased to above EU average, although that is not true on border counties.
Donegal, Cavan, Sligo, Leitrim and Monaghan have a combined GDP per capita of 68pc of the EU average, on a par with Eastern European regions classified by the EU as being “less developed”, Mr Daly said.
There’s been really strong employment gains in Galway in the last decade
By contrast, Galway, Mayo and Roscommon have a GDP per capita of 129pc of the EU average.
Last week, data from the Central Statistics Office showed that the border counties had a GDP of €32,617 per person, compared to €182,305 in Dublin, where big employers include the European headquarters of a number of multinational tech giants.
Mr Daly believes economic, population and employment growth in Galway has skewed the older GDP per capita figures relied upon by the Commission to reclassify the northern and western region of Ireland as a “more developed region”.
“About 58pc of the people employed by IDA companies in our region are in Galway, up three percentage points form a decade ago,” he said.
“There’s been really strong employment gains in Galway in the last decade, with Dexcom in Athenry, and Boston Scientific and Medtronic in Galway city. Then there’s the wider med-tech cluster in Galway city and the fact that it’s home to significant research assets like ATU and the University of Galway.
“But we’ve seen significant divergence since 2019 between the three western counties, where GDP per capita has been progressively rising, and the border counties. A major reason for this has been the growth of the Galway city metropolitan area,” he said.
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