Rapporteur: Mr Bernard SUAUD (France)
Co-Rapporteur : Mr Claude HAEGI (Switzerland)

EXPLANATORY MEMORANDUM

With the Council of Europe’s fiftieth-anniversary celebrations not long over¹, it is worth remembering that in the Treaty of London, under which the Council was set up, defence was the only area explicitly excluded from its sphere of competence (Article 1.d). Under Article 1.a, however, its goals included “facilitating […] economic and social progress”, while Article 1.b referred to “common action in economic, social, cultural, scientific, legal and administrative matters”. The Council of Europe has accordingly never neglected socio-economic issues. Inevitably, the Standing Conference and, subsequently, Congress of Local and Regional Authorities, has also taken an interest in socio-economic matters, a requirement which became even more pressing after the fall of the communist regimes in central and eastern Europe. Hence the Economic Forums of the Regions of Europe, of which six have been held since 1996: in Geneva (18-20 January 1996), Dortmund (23-26 June 1996), Moscow (25 and 26 November 1996), Vienna (9-12 September 1997), Bucharest (2-4 July 1998) and Weimar (3 and 4 May 1999).

Background to the report

At its 6th plenary session in June 1999, the Congress adopted Resolution 86 on regional economic partnership as a factor for social cohesion in Europe, presented by Mr Bernard Suaud following the Bucharest forum in July 1998. Paragraph II.d of the resolution recommended that the Bureau of the Chamber of Regions instruct the Working Group on Social Cohesion and the Economic Development of Regions to “make an evaluation of the results of the six Economic Forums of the Regions of Europe held since 1996” so that the Standing Committee could “define the future orientations of this programme of activity” (paragraph II.e).

The six Economic Forums of the Regions of Europe have each been attended by between 300 and 800 people, which makes an overall total of nearly 3,000 participants. The broad intention was to bring the regions and the business world together to discuss a particular economic issue, at the same time giving them an opportunity to display their products and services and forge links that could continue after the forum. “Democratic stability is impossible without economic success”, to echo a favourite sentiment of Claude Haegi, the former President of the Chamber of Regions (1994-1996) and of the Congress as a whole (1996-1998) and the “moving spirit” behind the forums.

Co-operation between the Congress of Local and Regional Authorities of Europe and the Foundation for the Economy and Sustainable Development of the Regions of Europe (FEDRE)

The meeting held in Geneva in January 1996 was entitled “First East/West Economic Forum of the Regions of Europe”, and the east/west theme, in relation to the economy and regional development, has been a constant feature of the forums. The Geneva Final Declaration stated (paragraph VI.32) that “the representatives of the regions support and encourage the major initiative to establish a Foundation for the Economic Development of the Regions of Europe”.

Four months later, the Foundation for the Economy and Sustainable Development of the Regions of Europe (FEDRE) was set up in Geneva under Swiss law. Its statutes of 25 April 1996 specify that one of its activities is to “organise annual encounters of the regions on specific subjects affecting the economic development of the regions in the fields of industry, transport, services, energy, tourism, health care and vocational training, inter alia”.

The FEDRE’s inaugural president was Claude Haegi, who at the time was President of the Chamber of Regions. A few months later he became President of the Congress as a whole for a two-year term; he is currently the Past President of the Congress, a post he will occupy until June 2000. Mr Haegi has therefore provided a personal link between the CLRAE and the FEDRE and was also the instigator of the First East/West Forum in Geneva in January 1996, in his capacity as a member of the cantonal government with responsibility for, among other things, regional affairs.

In its Resolution 38 (1996) on the First East/West Economic Forum of the Regions of Europe, the Congress instructed its Bureau “to consider the possibilities of providing logistic and financial support for organising the future work of the FEDRE” (paragraph 19). Regardless of the action actually taken on this Congress initiative, it is clear that the subsequent forums have all been the result of close co-operation between the CLRAE and the FEDRE.

Review of the individual forums

1. “First East/West Economic Forum of the Regions of Europe” (Geneva,
18-20 January 1996)

The forum was held at the Geneva International Conference Centre and was attended by some 500 people from 32 countries. The largest delegations came from Russia (the Parliamentary Assembly had just given a favourable opinion on Russian admission to the Council of Europe), Romania, Poland, Germany, France and, naturally, Switzerland. A number of regions also exhibited in the conference-centre foyer.

The discussions centred on the idea of economic “partnerships” at regional level. The aim was to examine the possibilities and limitations of regional-level east/west economic
co-operation and to consider the most suitable ways of encouraging western investment in the regions of central and eastern Europe. Reference was made in that connection to the use of new communication technologies such as the Internet. Discussions took place alternately in plenary sessions and smaller, specialised workshops.

Specific attention focused on a number of practical questions, such as the role of SMEs in industrial restructuring in transition economies, the role of banks (especially regional banks) and chambers of commerce, the development of tourist facilities, the promotion of transfrontier co-operation, ways of increasing legal protection and improving the certainty of the law in central and east European countries, and co-operation initiatives in the agri-foodstuffs, education and culture sectors. The political events of the time led to a special session being held on the possibilities of east/west co-operation in the rebuilding of regions affected by conflict, particularly in former Yugoslavia.

Impeccably organised (by the Congress Chamber of Regions and the Department of the Interior, the Environment and Regional Affairs of the Canton of Geneva), with added interest created by the wave of new east European Council of Europe members (headed by Russia) and by the crisis in Yugoslavia, the first East/West Economic Forum of the Regions sparked off an enthusiasm epitomised by the offer, in plenary, from the Mayor of Dortmund, Mr Günter Samtlebe, to host a second forum shortly after and by the approval of the idea of setting up a Foundation for the Economic Development of the Regions of Europe (which subsequently became the FEDRE) to follow up the forums and the contact and opportunities for partnership they generated. The Geneva forum may therefore be considered a success.

2. “Experiences of and prospects for industrial restructuring” (Economic Forum of the Regions of Europe, Dortmund, 23-26 June 1996)

The same can be said of the Economic Forum of the Regions of Europe held in Dortmund barely six months later. The concern this time was more technical: to consider “experiences of and prospects for industrial restructuring”. Thanks to the considerable resources channelled into the event by the City of Dortmund and the Land of North Rhine-Westphalia, the Dortmund forum has probably been the most impressive of the six forums held so far. Between 23 and 26 June, over 800 people from 27 countries piled into the huge Westfalenhalle 1. The German delegation was the biggest, with nearly 500 members representing not only the political authorities but also, importantly, a wide range of economic sectors (such as chambers of commerce, applied research institutions, businesses and consultancy firms).

In addition, there were no fewer than 74 exhibition stands, representing regions and cities from across Europe, businesses, chambers of commerce, universities, research or development institutions and so on.

The theme of the forum, industrial restructuring, was examined from various angles, including the transition from mass production to high technology, privatisation of state-owned companies, setting up SMEs, the role of the service sector in the modernisation of regional economies, public-private partnerships for water and waste treatment at municipal and regional level, the role of financial institutions in restructuring the economic sector, scientific research and technology transfer. Emphasis was also laid on the new openings created by the multimedia communications sector, and on environmental protection through sustainable development. The forum also provided a significant opportunity for co-operation with the European Union, with an opening speech by the President of the European Parliament, Mr Klaus Hänsch, and a presentation of the EU’s structural policy on the regions by the commissioner in charge of regional policy at the time, Ms Monika Wulf-Mathies.

At Dortmund, the cities of Vienna and Moscow expressed interest in hosting subsequent forums. The final declaration stressed the importance of the new information technologies as “a fresh chance to further the economic co-operation of the regions”, and presented an outline proposal for an “Internet of Regions”, an idea which the FEDRE then took up but, owing to lack of resources, was only able to realise a few months ago through its Euroregions website (http://www.fedre.org).

The Economic Forums of the Regions of Europe were now well and truly established. In its Resolution 42 (1996), the Congress invited local and regional authorities to “support this programme of co-operation and join with the FEDRE and the Congress in organising future economic forums of the regions of Europe, in co-operation with the international organisations representing European regional authorities” (paragraph 7.e).

3. “Economic Forum of the Regions of Europe for Co-operation, Security² and Sustainable Development” (Moscow, 25 and 26 November 1996)

A mere five months after Dortmund, it was Moscow’s turn to host a forum, the third in the series, which took place at a crucial moment in the Russian Federation’s evolution and in its relations with the Council of Europe (the Federation, a vast country four times larger in surface area than all the other member states put together, and the hub of communism from the October 1917 Revolution until Boris Yeltsin’s arrival in power, had joined the Council of Europe on 28 February 1996). All this meant that the symbolic, political aspects of the event distinctly overshadowed the forum’s supposedly economic content. It should be added that the scale of the theme, contrasting with the much narrower, more technical theme of the previous forum, lent itself to this shift in focus.

The forum’s transformation into a symbolic political event was underlined by the decision to hold a meeting of the Congress Bureau alongside the forum - the first time the Bureau had met in eastern Europe. On the Russian side, the forum was organised by the Moscow city authorities, the Federal Assembly, the Government of the Russian Federation and the Moscow-based Economic Forum of [Russian] Regions.

The forum received substantial press and television coverage in Russia and was further enhanced by the presence of high-profile figures such as the mayor of Moscow, Yuri Luzhkov, the Prime Minister, Viktor Chernomyrdin, and the Minister for Foreign Affairs, Yevgeny Primakov.

Those were the most notable features of the forum. Ninety per cent of the 550 participants were Russian. Owing to the Russian context, there was much more of an emphasis on issues relating to federalism than there had been at the first two forums. At the end of the forum, the participants adopted the Moscow Declaration on the Regions of Greater Europe. Pointing out that the new Europe now extended to Petropavlovsk-Kamchatski and Vladivostok, the declaration called for “the development of interregional and international co-operation … in particular in financial and energy sectors, agro-business, construction and … infrastructures”.

It is therefore fair to say that there was a lack of direct economic effects of this Forum, which was dominated by the event’s political and symbolic dimensions and by the way some Russian politicians used it as a political platform. We can also note that the Congress was better known with this event in the Russian political world which started at this time to discover the Council of Europe and its specific working methods.

A sign of the importance attached to this event by the Russian authorities is the rapid publication of the Forum's proceedings in the Russian language.

In 1996, then, as many as three forums were held within the space of eleven months. Since then, only one forum has taken place per year.

4. “Regional and Urban Environmental Technologies for the 21st Century” (Vienna,
9-12 September 1997)

The Vienna forum took place ten months after the Moscow forum. As with the Dortmund forum, there was a precise, fairly specialised theme. Vienna was therefore more in line with the first two economic forums, but made less of an impression because of the few exhibitors (there were hardly any apart from those representing Dortmund) and the much smaller involvement of the host-city authorities.

A total of 300 people representing 25 countries attended the event, which took place at the Messe Congress Centre. The largest delegations were from Austria (naturally), Switzerland, Romania, France and Ireland.

In alternating plenary sessions and workshops the forum dealt with three sub-themes:

- transport, logistics and telematics for citizens;
- urban utilities and refuse treatment;
- urban renewal and new construction policies.

Looking ahead to the next century and emphasising sustainable development, discussion ranged across technical matters such as telematics, inter-modal transport logistics, traffic guidance systems for cities and surrounding areas, air quality in cities, new ecological housing and urban renewal for sustainable development.

The forum took place alongside a European exhibition on environmental technologies, industry and engineering. An International Information and Partnership Exchange for research and technology co-operation projects was set up, but little was done to give a follow up after the Forum. This Exchange allowed to bring together –in special working groups- experts and representatives of local and regional authorities and the different industrial sectors.

No fewer than three cities or regions offered to host future forums. The press release issued at the end of the event stated that the next forum would be held in Geneva in May 1998 and that Bucharest and the German state of Thuringia had offered to host subsequent forums.

However, as the Congress was keen for central and eastern Europe to host more of the forums, the 1998 forum was ultimately held in Bucharest.

5. “Investment and local and regional development policies at pan-European level” (Bucharest, 2-4 July 1998)

Just over 300 people from 19 countries attended this forum, held at Parliament House (formerly Ceausescu’s palace) in Bucharest, at the invitation of the city’s mayor (Mr Viorel Lis) and the Romanian Government. The Romanian delegation alone accounted for half of those present.

In contrast with Vienna, there were quite a few exhibitors (chambers of commerce, local and regional authorities), but nearly all of them were Romanian.

The Bucharest forum was similar in form to the Vienna forum and likewise focused on an economic theme with special reference to the local and regional level; here, though, there were more representatives of local and regional authorities and the economic sector (businesses, chambers of commerce, development agencies) in all parts of the host country, and this was reflected in the larger number of exhibitors. However, the forum focused more on the host country and was therefore less “international” than its predecessors (except for the Moscow forum), as also was the Weimar forum the following year.

The Romanian setting was much in evidence - both contextually and substantively - during preparations for the forum and at the forum itself.

Contextually, preparations for the forum were somewhat disrupted by the resignation in March 1998 of the Romanian Government and the changes in the Bucharest town Hall. The final preparations were done in co-operation with the mayor of Bucharest, Mr Viorel Lis, the Parliament and the new Romanian Prime Minister, Mr Radu Vasile.

Substantively, a special session on regionalisation in Romania was held on the second day. More generally, the forum was much taken up with the specific problems which central and east European cities and regions often have in attracting investment from western public and private sources.

One session was devoted specifically to national law and foreign-investment possibilities in Romania, Poland and Hungary. In exchange, there were presentations on European financial institutions (the Council of Europe Social Development Fund, EIB, EBRD) and European Union and United Nations Economic Commission for Europe regional development policies. Practical examples of urban and regional development projects were also presented (Bucharest 2000 and St Petersburg) along with east-west regional development projects (eg Balaton/Loire inter-region co-operation and co-operation between Bistrita, Opole and Franche-Comté in the agri-foodstuffs and dairy sectors). Particular attention was paid to the special problems of border regions, which are often poorly integrated into transport and communication networks, and to the potential benefits of transfrontier co-operation in terms of sustainable economic development.

The concerns of local and regional authorities in central and eastern Europe were apparent in the final declaration, which stated that “significant problems remain with regard to transforming the country’s economic fabric in order to adapt it to the demands of the market economy and the challenges of globalisation”. A number of key areas were identified in this connection: privatisation and co-operation between the public and private sectors, an area requiring “special efforts”, and transfrontier co-operation, which was often hindered by a lack of legal powers and financial resources at regional level. Various courses of action were suggested, such as developing and promoting policies to support the establishment of small and medium-sized firms.

The Forum offered an occasion for the representatives of small and medium sized firms of Western Europe to develop commercial contacts with their Romanian collegues. In fact, commercial relations have been successfully strengthened after the Forum for example between French and Romanian enterprises.

All in all, whether at the forum itself in July 1998 or during the discussion of Bernard Suaud’s report (CPR (6) 5) in Strasbourg in June 1999, local and regional authorities of countries in transition expressed keen interest in economic forums of this kind, which address some of their most important practical, everyday concerns. It also seems clear that these countries would like the Congress to help develop and improve this opportunity for dialogue and information exchange.

6. “Culture as an economic factor” (Weimar, 3 and 4 May 1999)

The setting of Weimar again provided a link with municipalities and regions in transition countries, although the emphasis was much less marked. After all, the former East German Länder, which have been united with western Germany for ten years, are not in the same predicament as Romanian cities and regions. Moreover, the representatives of the Government of Thuringia, the host authority as well as most of their staff had an working experience with the system of free market and pluralistic democracy.

The theme of the forum was, of course, related to the choice of Weimar as the 1999 European Cultural Capital. This was both a good and a bad idea. While the forum was organised by the Land, the cultural events held throughout “Weimar 1999” were mostly organised by the Weimar municipal authorities (the Land capital, it should be pointed out, is Erfurt and not Weimar). Secondly, it is not always easy to find anything new to say about relations between culture and the economy, although the economic interest in cultural events is growing permanently in the liberal market economy. Lastly, the impending regional elections (scheduled for September) made for strained relations inside Thuringia’s ruling “grand coalition”. The Minister for Economic Affairs, for instance, belonged to the right-wing CDU, while the Minister for Justice and European Affairs belonged to the left-wing SPD. As it turned out, the Minister for Justice was the mainstay of the forum, with the result that its strictly economic content was diluted. Private-sector economic institutions received relatively little information about the forum and were poorly represented, with most participants representing public-sector institutions working in the cultural field or culture-related professions.

The forum, which took place at the Mon Ami Conference Centre, on Goetheplatz in Weimar city centre, was on similar lines to the Vienna and Bucharest ones. There were just over 300 participants from 25 countries. As in Bucharest, about half of those attending were from the host country (Germany).

The impeccable organisation compensated for insufficient representation of the economic sector and a preoccupation with German domestic issues in some of the discussions. However, Thuringia’s Department of Justice and European Affairs placed the emphasis on the forum itself rather than on exhibition stands, which were few in number.

The forum ended with a Declaration on the Cultural and Economic Future of an Integrating and Globalising Europe. The declaration called for improved dialogue between the economy and culture, stressed the role of culture in creating jobs and urged local and regional authorities to democratise culture so as to reach a wider public.

The Weimar Declaration also called on the Council of Europe to draw up a declaration of basic cultural rights, with the emphasis on “the conservation and development of cultural traditions, new ways of expression, maintenance of cultural variety, and access to information and education in the arts and culture”; such tasks were “a joint effort that society has to take responsibility for” and not merely “basic rights to be guaranteed by government”.

The political dimension of this event was completed by a special session on the 50^th Anniversary of the Council of Europe which brought together young people from different European countries for a discussion on European co-operation and integration.

The Forum of Weimar showed the importance of culture as an economic factor and a product to be commercialised. Several examples were presented, such as the Guggenheim Museum in Bilbao (Spain), which showed that investments in the cultural field can be very profitable and thus contribute directly to regional economic development.

Conclusions

1. An innovative, useful tool

First of all, it is worth recalling what prompted these forums: the realisation by the Congress, and in particular its Chamber of Regions, that its dealings with municipalities and regions in central and east European countries in transition should not be confined to questions of democracy and human rights, leaving it to others to discuss economic issues that were equally pressing and had a considerable bearing on the transition to democracy, the rule of law and greater decentralisation in those countries.

Nearly four years on, that initial point seems as relevant as ever: the economic problems facing local and regional authorities in central and eastern Europe in particular are still serious enough to justify continued action specifically relating to the economy.

The economic forums, an initiative pursued by the CLRAE in association with the FEDRE, provide a highly original platform for Europe-wide dialogue and exchange. The frequency (nowadays once a year) and scale (almost 3,000 participants since 1996) are unparalleled in the field of local and regional government. They are also unique in that discussions are not concerned with transfer of western public funds under some
pre-membership structural policy, as with the European Union, or under a scheme to assist transition, as with the EBRD, but deal with shared problems with a view to mutually beneficial partnerships of equals.

Alongside policies involving transfer of funds or provision of technical assistance (EU, EBRD) on a Europe-wide scale, there is an urgent need for continuous, “horizontal” dialogue between the key players at local and regional level; the forums provide an ideal tool for this.

Having demonstrated why the forums are necessary, we should now consider how they might be improved.

2. Possible improvements

The forums are organised by three partners: the host city or region (which changes each year), the FEDRE and the CLRAE (which are involved each time).

Co-operation between the two permanent institutions, the FEDRE and the CLRAE, is now well established and remains informal. The CLRAE, in consultation with the FEDRE, chooses the venue for the next forum from among the cities and regions that have put their names forward. It provides logistical assistance (sending Secretariat members, interpreters and Congress representatives) and helps with the preparations (the issuing of invitations, for example), promotion (the final declaration and press release) and follow-up to the event, which is closely linked to its other activities. The FEDRE promotes the forum by publishing special features in its magazine Régions, partenaires de l’Europe / Regions, partners of Europe. As from 2000, it will be in a position to give the forum widespread coverage on its trilingual website (in French, English and Russian). It also uses its contacts to encourage greater involvement of the economic sector in the forums.

The role of the host authorities is in many respects crucial, since they are responsible for on-site organisation, contacting many of the speakers and inviting a large proportion of the participants. Since the forum is held at a different venue each time, the on-site organisation varies, as does the context in which the preparations take place. The important role of the host city or region, far from lessening, was very apparent at the last two forums, in the choice of theme (in Weimar), the size of the event (sometimes there is a very large delegation from the host region or country) and the interest (or lack of it) in arranging a
back-up event with large numbers of display stands and “contact points” where forum participants and exhibitors can meet.

The best means of achieving greater consistency in the services offered by the host cities or regions is to make the choice of venue conditional on the formal acceptance of a detailed set of specifications: the theme of the forum, the conference-hall facilities (including interpreters’ booths, overhead projectors, Internet terminals and a bar/restaurant within the building for participants’ use, whether free of charge or not), provision of exhibition areas (possibly on a paying basis) where regions and firms can display their products and services, at least one official reception for all speakers and participants, and so on.

3. Ensuring continuity within change

The forums only serve a meaningful purpose if they are part of a reasonably long-term exercise. But they are also, by their very nature, a series of individual events, potentially heterogeneous, particularly as there is no fixed venue (it was initially suggested that every other forum could be held in Geneva, although this idea has now been scrapped) and it is considered desirable to alternate to some extent between eastern and western Europe (with the further option of also alternating between northern and southern Europe). Furthermore, the themes are different each time, as, in many ways, are the concerns and methods of the host authorities.

While each forum will by definition remain unique, attempts must be made to ensure that all forums are entirely consistent with the approach pursued since 1996. In particular, their Europeanness should be guaranteed by a rule that no more than 50% of speakers and participants can be from the host region or country (this has not always been the case). The inclusion of a workshop or round table focusing on an issue of specific interest to the host country, as at the Bucharest forum, makes it possible to “customise” each forum without unduly reducing its European outlook. It is also important to assure the participation of economic and professional representative bodies, such as Chambers of Commerce and Industry, professional Chambers, etc.

The Forum can also be considered as an exhibition window for the host country to present itself to the foreign participants and as a platform for intensifying contacts and interregional co-operation, thus fostering European solidarity and economic, political and democratic stability.

Follow-up between forums should be less concerned with administrative matters than with communication. The new media should be used with the aim of gradually building up a tangible network from the forums, so that their effects will be felt more fully. Co-operation between the Congress, the FEDRE and the host institutions should also work towards that.

By continuing the programme of these economic meetings, the Congress of Local and Regional Authorities of Europe can further develop an important instrument of co-operation, which allows to complete its political work with socio-economic activities, which are an indispensable complementary factor for developing and stabilising the democratic structures in the new member countries.

² The French and English versions of the programme, but not the Russian one, qualified “co-operation and security” with the adjective “economic”. This point is not insignificant in view of the remarks that follow.