Regional policy

By participating in international cooperation on regional policy, Norway is contributing to the exchange of experience with other European countries and regions. This exchange and cooperation is valuable for Norwegian regional policy and business development. The EEA Agreement does not include the EU’s regional policy, but Norway is a partner in several of the EU’s regional development programmes.

International cooperation on regional policy is also important for safeguarding Norway’s interests, particularly with regard to revisions of the EU’s regional policy and the rules governing state aid. Through the EEA Agreement, Norway is obliged to comply with the rules for state aid – including regional state aid – that apply in the rest of the EU/EEA.

The EU’s regional policy
The EU’s regional policy involves investments to reduce economic disparities between regions and create attractive, innovative and competitive regions in all the EU member states. This policy is an expression of solidarity with the less developed countries and regions of the EU. Regional policy and support is designed to create jobs, boost economic growth, improve quality of life and promote sustainable development in the eligible regions. Regional support should also enhance efforts to attain the goals in the Europe 2020 strategy for growth and employment.

About EUR 347 billion has been set aside for the period 2007–2013 for regional policy support in EU member states. These funds are used to improve the transport and internet infrastructure in remote areas, support small and medium-sized enterprises, invest in environmental and energy efficiency measures, and boost education. Regional policy during this period is financed by the Structural Funds and the Cohesion Fund.

The Structural Funds consist of: the European Regional Development Fund (ERDF), which supports development and structural adjustment in regional economies, economic change, competitiveness and territorial cooperation; and the European Social Fund (ESF), which supports adaptation among employees and businesses, jobs and participation in the labour market, social inclusion, and initiatives combating discrimination.

Since 1994 the Cohesion Fund has supported the poorest regions in the EU in order to promote growth, job creation and sustainable development. The fund supports environmental projects and trans-European transport networks. EU member states with a gross national income (GNI) per inhabitant of less than 90 % of the EU average are eligible for support from this fund.

Participation in regional cooperation programmes
Although regional policy is not part of the EEA Agreement, Norway participates in a number of cooperation programmes for regional development.  Since 1996 Norway has been involved in the European territorial cooperation programme INTERREG. This programme, which aims to promote cross-border social and economic integration through regional cooperation, was established to strengthen cooperation between neighbouring regions that are divided by national borders within and at the external borders of the EU.

Central government bodies, counties, municipalities, NGOs and private enterprises can participate in projects and receive funding through INTERREG. Norway contributed about NOK 200 million to the programme during the period 2007–2013. About half of these funds were allocated by the Ministry of Local Government and Regional Development, while the remainder were provided by the project participants.

During the period 2007–2013, Norway was involved in 11 INTERREG programmes:

  • Four cross-border programmes along the borders to Finland, Sweden and Denmark (‘Nord’, ‘Botnia–Atlantica’, ‘Sweden-–-Norway’and ‘Oresund–Kattegat–Skagerrak’)
  • Three transnational programmes (‘Baltic Sea Region’, ‘North Sea Region’ and ‘Northern Periphery’)
  • Four pan-European programmes (ESPON, INTERACT, INTERREG IVC and URBACT II)
  • Norway is also engaged in cross-border cooperation with Russia within the framework of the European Neighbourhood and Partnership Instrument(ENPI).

Norway is actively involved in the development of programmes for the period 2014–2020.

Regional state aid
Under the EEA Agreement, Norway must follow the rules for state aid that apply in EU member states, including the rules for regional state aid. The EFTA Surveillance Authority (ESA) monitors compliance with European Economic Area rules in Iceland, Liechtenstein and Norway.

The rules for regional state aid determine where regional state aid can be given in each country and what types of aid are allowed. The level of aid allowed is differentiated according to the level of development in each region. If state aid is granted in excess of the amount approved by ESA, ESA will order repayment of the unlawful state aid.

In addition to regional investment aid and transport aid, the rules allow for other types of support in areas with very low population density, for instance regionally differentiated social security contributions. The rules also allow for aid to newly created small enterprises during the first five years of their existence.

For many years Norway has actively sought to influence the Commission in the development of new rules in this area. The European Commission has started revising the rules for regional state aid for the period 2014–2020. Norway is actively engaged in this work.  

For more information on regional state aid, see the website of the Ministry of Local Government and Modernisation.