EU COHESION POLICY: IMPACT ON PUBLIC INFRASTRUCTURE IN LATVIA

With total financial resources of (sic)347 billion for the 2007-2013 planning period (European Commission, 2007) European Cohesion policy is to provide robust support for budgetary stability and public investment in the Member States and EU regions in times of heavy budgetary constraints. Such financial interventions are undoubtedly important for Latvia, the EU "leader" in growth of unemployment rate and general economic downfall in recent years. Present planning period follows previous programming periods, which are described as successful in making difference to standards of living across European Union (European Commission, 2007), not very effective (de la Fuente, 2003) and failed to deliver a satisfactory growth performance (Sapir et al., 2004). Some researchers note that no evidence is found that the policies adopted are the most appropriate (Boldrin, Canova, 2001) and the Cohesion Funds should be terminated with the end of the previous spending cycle (2006) (Boldrin, Canova, 2003). The present paper seeks to contribute to these discussions by analysing EU Cohesion policy on the level of EU Member States and particularly Latvia. Since the raising awareness on environmental topics and the fact that most of the Member States as one of the funding priorities mark environmental issues as part of sustainable development strategy, one of the specific issues considered is the impact of the Cohesion policy on environment protection efforts. Moreover the analysis is done on Latvia's progress towards the implementation of EU directives in drinking water and waste water sector, marking the problems and issues to be considered in planning the future of the Cohesion fund. It is evident that initial concept of additionality of the EU funds is not working well enough in certain sectors in Latvia and further analysis should be done on country's possibilities to achieve the set targets and retain the results without EU funds. The paper includes proposals for developing country's policy and set of actions in such sectors under the present budgetary restrictions. The research method is comparative and logical analysis of the theoretical concepts, methods and conclusions, published in scientific literature including policy analysis.