The EEA Financial Mechanism

Enlargement of the EEA – Financial Mechanism

Norway will contribute almost €230 million annually to social and economic cohesion in the enlarged EU/EEA through the new EEA Financial Mechanism and the Norwegian Financial Mechanism in the period from 2004 to 2009. This implies a tenfold increase in the Norwegian contribution towards reduction of social and economic disparities in the EU/EEA area, and makes Norway one of the largest contributors of the 28 countries in the enlarged EEA.

Both mechanisms will enter into force on 1 May 2004. The objectives of the mechanisms are to contribute to the reduction of economic and social disparities in the EU/EEA area through the financing of grants to investment and development programmes and projects. Under the EEA Financial Mechanism the EEA/EFTA states will contribute €600 million in the period from 1 May 2004 to 30 April 2009 of which Norway’s share will be €567 million. Moreover, for the same period, Norway will contribute €567 million under the bilateral mechanism. In total, the two mechanisms will contribute €233,4 million annually to social and economic cohesion in this area.

The beneficiary states under the two mechanisms will primarily be the ten new EU member states (Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and Slovakia). Whereas the Norwegian Financial Mechanism is solely targeted at the new EU member states, the EEA Financial Mechanism also includes the EU member states Spain, Greece and Portugal. The grants will be available for projects in the following priority sectors: Environment, sustainable development, cultural heritage, human resource development and health and child care, as well as academic research targeted at one of the above mentioned sectors. As regards the Norwegian Financial Mechanism, the priority sectors will be the same as under the EEA Financial Mechanism, but with emphasis on projects in the areas of implementation of the Schengen acquis, environment (with emphasis on administrative capacity, infrastructure, technology and municipal waste management), regional policy and cross-border activities and technical assistance relating to implementation of acquis communautaire.

Being by far the biggest of the ten new member states, Poland will benefit from almost half of the total amount of the funds.

Although the two mechanisms are clearly separated, they will be closely co-ordinated regarding application procedures and assessments and the two mechanisms can also co-finance projects. Furthermore, the two mechanisms will share a secretariat (Mechanism Office that will be established in Brussels to assist in the implementation of the mechanisms. The more specific modalities, rules and procedures for the two mechanisms are now being drafted.

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On 3 July 2003, the EEA Enlargement Agreement was initialled