The EU's crisis-busting projects

 October 23, 2011

On the 19th of October, the European Commission has announced in a press release that it will invest 31.7 billion euros into the transport infrastructure of member countries in need. Until now, as the document states, rail and road networks have been developed within the EU on a national basis. Opportunities for interconnectivity have thus been lost and that has severely restricted the free flow of goods and people across the continent.

Mediterranean countries such as Spain,for example, stand to benefit most from such investments. According to La Vanguardia, a rail link along the coast from the Franco-Spanish border to Algeciras in the south will finally be built in the next few years, at a cost of some 19 billion euros. The railway will bypass Madrid altogether. This development is also in line with the measures advocated in a recent Project Syndicate op-ed (“Mediterranean Reborn”) by Javier Solana. According to him, the building of new rail links connecting southern Europe with the centre of the continent will reduce costs as well as pollution levels and help rebalance the current trade flows from the Pacific region to Europe. Since northern European countries have far better-equipped harbour and rail networks than the south, merchandise from the Far East or India that comes via the Suez Canal into the Mediterranean currently bypasses ports like Venice, Marseilles or Barcelona in favour of Amsterdam, Rotterdam or Hamburg, even though the trip is three days longer.

The Commission will allocate money for the upgrading and linking of oil and gas pipelines, as well, in an effort to streamline energy distribution across the continent.

Taken together, these projects have the potential of creating tens of thousands of low-level jobs across southern Europe, at a time when unemployment in Spain, for example, has reached alarming levels. (sources: Presseurop, European Commission press release, La Vanguardia, Project Syndicate).