European Funds for the Tourism Sector

For a long time in Europe there was no EU action on tourism, although the European Union has always kept the top spot for the reception of travelers from all continents.

Given the economic importance of this sector, the Community Institutions decided to intervene. Indeed, the Treaty of Maastricht in 1992 introduced the possibility for the European Community to take measures in the field of tourism. The objective in the field consists in achieving the convergence goals of the Community, such as economic growth and employment, economic and social cohesion and sustainable development.

The Lisbon Treaty established a new legal basis on tourism. The new legal basis does not mean that the European Union has an autonomous policy on tourism: the European Union aims to encourage an environment enabling the economic development and to facilitate the cooperation among Member States through the exchange of good practices.

Four priority actions have been identified by the European Commission’s 2010 Communication on Tourism:

1. Boosting competitiveness of the tourism sector in Europe
2. Promoting the development of sustainable, responsible and quality tourism
3. Strengthening the image of Europe as a continent of sustainable destinations and quality
4 Exploiting the full political and financial potential of the EU instruments aiming at developing tourism

Regarding tourism, the European Union has several funds whose purpose is to finance the four actions above.

– The COSME programme is the new programme for the competitiveness of enterprises and SMEs and continues the actions of the 2007-2013 Entrepreneurship and Innovation Programme (EIP) under the Competitiveness and Innovation Framework Programme (CIP). 
It aims at strengthening the competitiveness and sustainability of the Union’s enterprises including in the tourism sector, and at encouraging an entrepreneurial culture and promoting the creation and growth of SMEs.

– The European Regional Development Fund (ERDF): this fund provides funding for sustainable tourism-related projects;

– The Cohesion Fund: it finances infrastructure on the environment and transport, two key areas for tourism;

– The European Social Fund (ESF): the development of tourism is a major focus area of the ESF, given its potential for job creation and opportunities;

– The European Agricultural Fund for Rural Development (EAFRD): This instrument can also finance actions on tourism, as this sector has become an important source of diversification of the rural economy;

– The European Fund for Maritime Affairs (EMFF): this type of financial instrument supports conversion programmes in the tourism sector and encourages initiatives in eco-tourism;

– Concerning the EuropeAid international cooperation and development funds, the European Commission may occasionally publish calls for proposals to develop sustainable tourism or an economy based on tourism in a third country.

The types of financing instruments providing subsidies in this sector is very diverse and can cover virtually every aspect and nuances of an action focused on tourism.
It may be recalled that that within the European Union, the tourism sector in its strict definition affects about 2 million businesses. It contributes to GDP and employment, respectively, at 5 and 5.2% of the workforce, not to mention the fact that this sector has strong linkages with other economic sectors.