TARTU - Like all acceding countries, Estonia is eager to gain access to the union's structural funds in order to accelerate national development.
To date, projects have been financed from preaccession funds, with the annual total at some 1 billion kroons (64 million euros), and starting May 1, this sum could grow severalfold.
Although authorities often hail Estonia's net receiver status – its donation to the EU budget will be 1 percent of GDP and direct benefits some 3 percent – 4 percent – these expectations have yet to materialize.
In accordance with union procedures, a number of competent authorities – i.e., agencies – have been appointed to manage structural funds on a local level. However, no one is sure how well the system will function in the beginning on the part of the agencies and the applicants.
Unlike previous accessions, where newcomers Spain, Greece, Portugal and Ireland received massive money injections, the entrance of 10 relatively poor members is certain to make the soup less salty. The union offers support to the regions lagging behind in four large funds – the Regional Development Fund, the Social Fund, the Agricultural Guidance and Guarantee Fund and the Financial Instrument for Fisheries Guidance. These are topped by the Cohesion Fund, which is aimed at major environment and transportation projects.
Together, the great five distribute about a third of the EU's finances, amounting to some 213 billion euros during the budgetary period of 2000-2006.
The ERDF, the union's regional development tool, represents the largest of funds and could give Estonia some 1.1 billion kroons annually. The country's plan to channel the lion's share into transportation infrastructure and rural construction projects has prompted a lively discussion on whether brains should stand before asphalt, or vice versa.
A major obstacle to EU funding could be Estonia's administrative division – or, as critics like to put it, fragmentation. Amid a lack of decisive action by central authorities, only a few of the almost 250 municipalities have joined forces to create larger and stronger hubs that can better compete for finite funds. Many locals fear an identity loss through consolidation, and some rural officials are reluctant to surrender their king-of-the-hill positions.
According to Meelis Niinepuu, consultant at Innopolis OU, one of Estonia's leading EU project handlers, smaller municipalities are known to suffer from lack of competence and could therefore be left empty-handed.
"The great many are unable to offer any motivation to young, success-hungry specialists who could make things work. Also, small municipalities cannot provide the cofinancing required for most structural-fund projects," he says.
"Should we continue like this, Estonia shall probably not copy the Irish, Spanish or Portuguese success stories, but rather Greek or Southern Italian failure to make any use of regional development funds whatsoever," Niinepuu stresses.
Juri Raudseping, mayor of the Haaslava municipality near Tartu, does not share such pessimism. He notes that abundant information on structural funds is available via the Internet, and that there have been many project-related training offers from authorities and private consultants.
"Until now we have tried to get through on our own, but a project development specialist would be of much use," says Raudseping.