Abstract

Even though common spatial planning (the VASAB 2010 Programme) in the Baltic Sea Region (BSR) has already acquired considerable tradition and experience, the appearance of the INTERREG IIC programme constitutes a significant qualitative change of the co-operation both in financial and in organisational terms.

The INTERREG II C programme has decisively changed the situation when due to insufficiency of funds, particularly experienced in the countries of Central and Eastern Europe, BSR regions, municipalities and other relevant actors has not been able to fully get involved in the implementation of the spatial development strategy adopted in 1994 by all Baltic Ministers for spatial planning and development.

The INTERREG II C is an unique phenomenon. Built according to the principle of subsidiarity provides a link between strategic spatial planning and day to day spatial development taking place in regions and municipalities. It is one of the first EU initiatives where non-EU actors are fully involved on equal to EU countries basis. Since the main aim of BSR INTERREG II C is to strengthen the cohesion of the region it is very important to monitor the progress of the initiative and result achieved. In the paper the following topics will be discussed:

1.The background and the content of BSR INTERREG II C
2.The BSR way of introducing INTERREG II C to the region
3. The still existing obstacles and barriers in utilising in full all the possibilities crated by the INTERREG II
4. The gaps in spatial development of the BSR seen through the INTERREG II C project perspective
5. Comparative analysis of the projects proposed so far for BSR INTERREG II C.

The conclusions will deal both with the further development of BSR Interreg II C and also deficiencies of current spatial development of the BSR seen through the INTERREG II C project perspective.

In October 1995, in connection with the decision on the allocation of the Community Initiative reserves, an INTERREG II C was introduced - a new strand under the INTERREG Community Initiative. It was established to address funding needs of spatial planning in following fields: the areas suffering from severe draught, the areas suffering from flooding, transnational co-operation in the field of spatial planning .The Guidelines for INTERREG II C and the financial allocations to this initiative were finally decided in May 1996 and published on 10 July 1996 (OJEC C 200/96).The Baltic Sea Region (BSR) was defined as one of the seven transnational co-operation at the Commission’s seminar for launching INTERREG II C in July 1996, and immediately the EU members states (i.e. Denmark, Finland, Sweden, Germany, accompanied by VASAB 2010 Secretariat which represented the Baltic Sea Region transition countries started the work on preparation of the BSR INTERREG II C Operational Programme (OP). The focus of the programme was on transnational co-operation in the field of spatial planning in the BSR The programme was ready in the beginning of 1997 and finally approved by the EU Commission on 11 December 1997 which can be treated from the formal point of view as the starting date for the BSR INTERREG II C. The programme will continue till 31 December 1999, but the project supported can continue till the end of 2001.

THE ORIGIN

The transnational multilateral co-operation in the field of spatial planning is a relatively new phenomenon. Traditional spatial planning has emerged in towns and concerned land-use on a local scale. In the mid 19^th century overcrowded cities, some fenced behind fortifications, required technical sanitation and fire protection, and the new constitutional civic rights and industrialisation soon demanded buildings housing the new social institutions and an urban expansion for industrial and housing areas. For many years the need for housing and technical sanitation was a main issue for spatial planning. After the First World War an awakening interest in leisure and public amenities brought to the forefront the issue of broadening the planning concerns into a more comprehensive view of ordinary peoples living space. After World War II, spatial planning became deeply involved in facilitating urban growth at both city and regional levels. In the 1970s new patterns of urbanisation as well as a new awareness of the negative consequences of urban growth, led to a smaller scale of urban expansion, conservation of historic inner areas of cities, a more even distribution of services and life quality to rural and peripheral areas, the protection of natural resources and increased public participation.

A change of the role of spatial planning, from the typical land-use planning to the long-term spatial planning in which space is regarded as a framework for all kinds of sectoral and consumption activities of man took place in the 1980s. Production, service rendering, consumption, satisfaction of needs, all take place in determined space and compete between one another for the use and management of the space.

From these periods of shifting planning goals and issues spatial planning has inherited a wide range of goals. These include:

• Safeguarding private ownership and public interests
• Economising the use of land resources
• Improving accessibility
• Economising the exploitation of area bound non-renewable resources
• Conserving and protecting nature and cultural heritage from unintended consequences of development and from hazardous use of land.
• Promoting the functional and geographical co-ordination of infrastructure and the built environment
• Ensuring standards of technical sanitation, fire protection and safety
• Balancing location of private and public services, amenities and technical supply
• Reducing inequalities in standards of living due to the different development in prosperous and less prosperous regions and between centres and peripheries of growth
• Harmonising sectoral activities in space
• Economising financial means through co-ordinated action.

Some of these goals are related largely to regional and national planning, while others are related mostly to local planning. Regarded as one family of goals, however, they reveal that spatial planning is not about following a single goal but about balancing goals, some of which are oriented toward economic development and some to protection and conservation of nature and cultural heritage. Many of these goals can hardly been achieved without international co-operation.

Important for a shift in the goals, methods and role of spatial planning was the change of the development paradigm in the developed countries. It was sustainable development that started to be adopted in the 1980s as the objective of the processes. The concept of sustainable development has emerged on the wave of ideas which took into consideration the qualitative factors of development. Sustainable development was propagated by the Bruntland Commission (World Commission on Environment and Development of UN), which in 1987 proposed the following definition of the concept:

Though lacking certain degree of exactness, the definition was precise in expressing the concept of sustainability - the ability for a self-supporting development that does not deteriorate factors and mechanisms creating it.

Considered to be the main barriers of sustainable development, which can redirect development from the sustainable path, are the following factors:

· exhaustibility of so-called non-renewable assets, natural environment in the first place,

· insufficient reproduction of assets hard or slow to renew, like human capital along with culture and system of values, space and management of the latter, i.e. the technical infrastructure, settlement network and its development,

· strains greater than those socially acceptable, following from intergenerational inequity and lack of satisfaction of higher order needs in the process of economic growth (social alienation, exclusion from the society).

It can be thus assumed that sustainable development includes three mutually interdependent dimensions - economic, social and environmental.

In sustainable development, understood as above, spatial planning plays an important role as a regulating mechanism of space management. The latter, in the model of sustainable development, should not be fully subject to the rules of market game. This results from the fact that space is one of the resources that are hard to renew and it should satisfy the needs both of current and future generations, the latter not taking part in the decisions taken by the market, though. Therefore market regulation (free market) results in excessive use of space, with marginal costs exceeding marginal benefits in the social dimension. As far as space use is concerned, market evokes sub-optimum situations.

Hence there emerges a need for spatial planning, operating as an element of non-market regulation, the so-called public choice mechanism.

That way of thinking is presented in fig. 1.

Common international spatial planning also creates significant positive externalities. These consist in reduction of costs of location or development decisions in the regional dimension. Common strategies of spatial planning for pan-European regions, like BSR, consolidate regional identity, allow to deal with spatial planning conflicts more easily, enhance the investors’ interest in the region, making the development stable and predictable. Common spatial planning also allows to make development decisions rational in the regional dimension. As an example of that the issue of maintenance of (environmentally valuable) green areas, so-called green spots in the BSR, can be quoted. Most of those are situated in the countries in transition which, naturally, regard economic development as a priority. Nature conservation not always goes hand in hand with this objective. Therefore a regional (pan-Baltic) action concerning the resources is needed. Actions like that are jointly planned by HELCOM (MLW) and VASAB 2010, following the assumption that green spots are valuable to all countries of the region, not only to those in the area they are situated in.

As far as positive externalities are concerned, free market results in too low production of those. In the situation in question that means excessive exploitation of green spots, spatial planning becoming necessary as an element of so-called public choice.

As a positive externality, spatial planning also requires external international source of funding, at least in part, if not in full. Once it creates external benefits, costs of creation of those benefits should be borne by everybody enjoying the benefits, i.e. the regional community. Otherwise marginal benefits and costs in social dimension cannot be balanced. This very reasoning has paved way to INTERREG II C as a programme co-financing international spatial planning.

The way to transnational co-operation in the field of spatial planing has been paved by the EU-Member States together with the European Commission with documents like „Europe 2000" (1991), „Europe 2000+" (1995) and „Principles for a European Spatial Development Policy"(Leipzig 1994). The latter explicitly stressed the necessity for transnational co-operation in larger territories based on common visions, strategies and development concepts. The Leipzig paper was further developed to form the first official draft of the European Spatial Development Perspective (E.S.D.P.)

Simultaneously, similar process has been taken place in the Baltic Sea Region. Thus the basic document for further spatial development in the Baltic Sea Region (Vision and Strategies around the Baltic Sea 2010 - Towards a framework for Spatial Development in the Baltic Sea Region) was also adopted in 1994. Later on the label and the logo VASAB 2010 became somewhat a trade mark and contributed to the emergence of regional identity in that area. The close inter-relations between ESDP and VASAB were guaranteed also by persons taking part in both processes. In practical terms Operational Programme of the Community Initiative INTERREG II C concerning Transnational Co-operation on Spatial Planning in the Baltic Sea Region is the quintessence of the strategy of VASAB 2010 and provisions of ESDP. Not only the priorities, but even distribution of accents are concurrent in both cases.

The existence of analyses, of common visions and of organisational structures, provided in the framework of VASAB were important advantages for elaborating a common Operational Programme (OP) for transnational co-operation. Other inputs were given in particular from analytical work of the Nordic countries. In general, spatial planners of the respective ministries together with experts of Ministries responsible for the Structural funds and external experts took part in the direct preparation of the OP. Already the preparation of the Operational Programme was an intensive co-operation process. Thanks to the VASAB structures, not only EU Members but also all the other Baltic Sea States took part in this process. Moreover use could be made of results of years of co-operation within VASAB. Thus the VASAB-documents and as indicated above also the ESDP are the „red line" of the Operational Programme for INTERREG II C.

The INTERREG II C is an unique phenomenon. Built according to the principle of subsidiarity provides a link between strategic spatial planning and day to day spatial development taking place in regions and municipalities. This kind of co-operation has an innovative character as it contains working together of public authorities in transnational management and finance structures, decision-making on common funds in multi-national bodies which did not happen so far in Europe. It supports new forms of vertical and horizontal co-ordination and mutual understanding of different national administration, legislation and approaches to spatial planning. It might also be innovative in a way of defining regional development measures from a transnational context. It is at the same time no general working together and exchange of experience but action-oriented co-operation, aimed at concrete common project development and implementation.

The Operational Programme of the Community Initiative INTERREG II C concerning Transnational Co-operation on Spatial Planning in the Baltic Sea Region provides a platform for implementing both concepts in a concrete area of action. For this purpose transnational management and finance structures have been established. Unlike in other European fields of co-operation, in Baltic INTERREG II C both evaluation of the projects and the process of decision-making about granting funds is of fully international character, with all Baltic states co-operating on equal terms. All decisions taken are consensus-based. It is one of the first EU initiatives where non-EU actors are fully involved on equal to EU countries basis.

The Operational Programme of the Baltic Sea region INTERREG II C shall support the development of a future-oriented spatial structure and contribute to the better living conditions for the people and enterprise in the region by

a/ strengthening the development potential of the BSR,

b/ increasing economic and social cohesion,

c/ensuring a sustainable development for the region as a whole,

c/ promoting a territorial balance by supporting weak points and building on strong points.

The following specific objectives are listed in the document:

a/ the BSR is a recognised and integrated partner of the European and global society,

b/ the territorial balance between different parts of the region in terms of economy, ecology, social and cultural conditions is better than today,

c/ the urban system and settlement structure of the region is polycentric and decentralised shaping the basic spatial structure in the development of economy, infrastructure etc. offering a comprehensive variety of services for businesses and citizens due to their size and functions,

d/ the transport, communication and energy networks link the cities with adequate services comprising the rural hinterlands and remote areas suffering from peripherality,

e/ the specific areas such as the coastal zone, the islands, border areas, natural and cultural landscapes have been developed and preserved in a balanced way in accordance with their specific characteristics forming an assets for economy and quality of life in the region.

The Operational Programme concentrates on the following priorities:

7.1. Promotion of sustainable spatial development measures in the Baltic Sea Region.

7.1.1. Promoting a Baltic urban system and a balanced settlement structure

7.1.2. Improving communications and promoting energy solutions as part of sustainable regional development

7.1.3. Promoting integrated management and sustainable development of coastal zones, islands and other specific areas.

7.2. Promotion of a spatial development approach in the BSR

7.2.1. Further development of spatial planning strategies and exchange of experience in the field of spatial planning

7.2.2. Management of spatial planning relations in particular to natural and cultural heritage and tourism development

7.3. Technical Assistance to support transnational co-operation

Selection criteria deciding about the scope and magnitude of financial support fall into two categories comprising eligibility criteria and general selection criteria for ranking the projects.

• be of transnational character,
• benefit at least three states (either in three Member States or in two Member States and one Non-Member State).
• respect national and EU policies for the use of structural funds and the results and perspectives of transnational co-operation in spatial planning in the BSR approved by the respective ministers,
• refer to spatial planning and physical planning/ more efficient land use in accordance with visions, objectives and strategies of the programme following a multisectoral and territorial approach.
• \have an economic link,
• include the presentation of quantified outputs, when possible, and/or clear and attainable targets (at least a qualitative description) to follow ex-post evaluation,
• have a link to spatial planning in the framework of the ESDP and contribute to social and economic cohesion.

Additionally, the INTERREG II C projects should conform to the following requirements (general selection criteria):

• they should contribute to the implementation of the ESDP policy options,
• they should present an innovative approach,
• they should produce tangible and visible results which support economic activities, future investment and job creation,.
• they should contribute towards the economically, socially and environmentally sustainable development of the region,
• they should aim at achieving environmentally sustainable development of the region and towards safeguarding the natural and cultural heritage,
• they should be of cross-sectoral character or contribute to the multi-sectoral integration and co-operation and cause synergy effects and additional benefits (demonstrate value added of spatial planning),
• they should contain elements of system building i.e. there are which can administer the results of the projects, continue to build on them and contribute towards a long-term accumulation of knowledge,
• they should contribute to co-ordination with other initiatives/programmes in the region,
• they should contribute to attracting extra investments, especially from the private sector.
• they should have effects beyond the programming period e.g. functioning networks of co-operation.

When comparing BSR OP of INTERREG II C with similar programmes from other fields, in addition to clearly marked multilateral character of the programme (reflected also in the way it is administered), its Baltic dimension is well-worth stressing.

The Baltic Sea Programme has specific features relating to sea and air transport and forms of combined transport in order to diminish obstacles in that respect. It also deals more intensively with coastal zones and islands and with specific structures of Non-EU States, in particular Central and East European States

The INTERREG II C is managed by two international committees: the Monitoring Committee and Steering Committee seated in Rostock. The first supervises the observance of the European Union regulations pertinent to the Structural Funds and approves the criteria allowing the projects to receive financial support from INTERREG II C, the other divides the funds and provides financial support to particular projects. Both Committees are supported by a Secretariat with two offices one in Rostock (located in a branch of a regional investment bank. Additionally), and second in Karlskrona in Sweden (located in the Baltic Institute). The joint Financial Body was established (located in Rostock) to serve the financial side of the projects. The solution is of unique character and is a proof of the Baltic states’ integration in respect of spatial planning. Pooling money and withdrawal from national jurisdiction and supervision in issuance of them is not followed in other areas of co-operation of INTERREG II C.

The budget of INTERREG II C in the Baltic Sea Region is ECU 47.508 million, while approximately half of its ECU 24.962 million) should come from the structural funds (ERDF) of the EU and the remaining part from local, regional and national, public and private sources. Norway is contributing with ECU 2.032 million. That amount should be disposed of before the end of 1999. According to the EU regulations the INTERREG II C money can only be spent on the territory of the Union. However, the non-EU experts can be paid from this money as well. The PHARE countries which will be involved in the multilateral projects to be financed within INTERREG II A and II C frameworks can receive financial support from PHARE Baltic Project Facility (ECU 14 million) . A special strand called PHARE/INTERREG II C was established to match the INTERREG II C money in the case the PHARE countries are involved in the INTERREG II C projects. TACIS countries can receive support from the TACIS „main CBC fund (ECU 24 million in 1997)or/and from the TACIS Small project Facility (ECU 5 million in 1997)

In order to accelerate the process of development of INTERREG II C projects, concrete actions were taken by ministries of the Baltic countries responsible for spatial planning, using VASAB structures first of all. These included:

• information campaign concerning INTTERREG IIC in the Baltic Sea Region, in particular:

Effects of the above mentioned actions of VASAB have surpassed wildest expectations. At each of both conferences, i.e. that of Rostock and the other one of Karlskrona about 70 projects were presented, and the number of participants exceeded 200 persons. The growth of projects meeting requirements of INTERREG II C has been symptomatic. The share of „advanced" projects grew from 4% in Rostock to 31% in Karlskrona. The „homework" of Rostock was done well. This was confirmed during the first round of distribution of INTERREG II C funds in BSR in May-June 1998. During the first call for BSR INTERREG II C transnational spatial planning projects 36 applications were received by the INTERREG II C Secretariat. From these 22 were formally eligible. In total all the applications of the first call have been requesting more than 60% of funds assigned for INTERREG II C in the BSR for 19998-99 .

The Steering Committee of the BSR INTERREG II C made the first financing decision on projects on 25-26 June, 1998. It was decided to support sixteen projects. The rest will probably come back during the autumn call in October. Out of those sixteen projects three applications (18.75% of total funded in the first round) are targeting measure 7.1.1-, seven (43.75% of total funded in the first round) are targeting measure 7.1.2. three are targeting measure 7.1.3.- and three are targeting measure 7.2.1 -However, if the money requested from INTERREG II C are considered the picture is slightly more balanced with one exception measure 7.2.1. The largest funding has been given for 7.1.2 measure - 2.961.929 ECU . Next is 7.1.1 measure -2.571.669 ECU, then 7.1.3. measure 2.309.364 ECU The lowest but still considerable funding has been for 7.2.1 measure - 1.545.500 ECU. Moreover 2.330.000 ECU from PHARE and TACIS have been requested by the partners from Central and Eastern Europe for the above mentioned sixteen projects.

Table 1.

Funding by projects

In total the sixteen approved during the first call applications have used around 40% of funds assigned for BSR INTERREG II C for 1998-99. The greatest relative funding has been given during the first call for measures 7.1.1. and 7.2.1. - respectively 60% and almost 73% of available funds for these two measures This shows relative weight and importance of individual groups of projects to regional and local authorities of the BSR.

The transnationality of these 16 projects seems more than satisfactory. There are 137 partners actively co-operating from all BSR countries being supported by the 193 so called additional partners not directly involved.

All projects (with only few exceptions) were presented by local and regional authorities with only some support from national level. This is also true about the transition countries. However, in Lithuania and Latvia the national authorities have played a more prominent role in project facilitation".

Projects on urban networks try to solve major problems of cities and their relations to surrounding areas in networks of city regions (uncontrolled urban growth spreading into the countryside, social and spatial segregation, traffic congestion, environmental pollution, the use up of natural resources like water, non-sufficient recycling, lack of open spaces and untapped landscapes). These projects will not only propose strategies but will also provide concrete practical guidelines for handling problems and preparing investment. Another question here is a conscious approach towards the water functions along waterways and towards the coast. The background is overcoming the political division of the Baltic Sea Region. There is a great challenge but also a chance that cities can regain their functionality for the Baltic Sea Region and strengthen their overall international competitiveness. Specific features of such projects include use of derelict land, conversion of old harbour areas, strengthening attractiveness of the waterfronts of towns by means of urban building and planning. Cities and towns of EU and non-EU states will be restructured in that way. Another project idea has its starting point in existing sport boat harbours. Based on spatial planning considerations, the creation of a network of such harbours around the Baltic coast will be supported, taking into account economic, environmental and spatial criteria. In addition, the strengthening of attractiveness of port cities through urban development measures will be prepared.

Several projects pay attention to transnational (trans-European) corridors. The question here is to combine transport development with sustainable regional development, to find suitable forms of combining modes of transport, to pay attention to the development of settlements and their transport connections, to use and to develop potential for tourism, to use and maintain natural and cultural heritage and to prepare the ground for concrete investment. Some of these projects deal with transport corridors between EU and non-EU States, supporting the process of growing together for the whole area.

A series of projects is dedicated to coastal zone planning and management. Via those projects the operability of „Common recommendations for spatial planning of the coastal zone in the Baltic Sea Region", prepared by VASAB (CSD/BSR) will be examined.

Interesting projects are also prepared for „patches". In co-operation between Swedish, Polish, Latvian and German regions, characteristic of which are large nature-protection areas, ways and means will be examined and implemented to see how economic development can be combined with nature protection. The project will also deal with alternatives to and inside agriculture as development factors for rural areas.

A part of the projects fill the gaps in VASAB strategy. These are, for instance, projects on regional impact assessment of development of waterways in Baltic Europe (Baltic Sea Region), or projects concerning regional impact assessment of development of regional air transport. Similar in nature is a project of creation of a unified system of spatial monitoring in BSR on a regional level. What is even more important, the project is supposed to closely co-operate with another project concerning the establishment of a cartographic basis for information collected under GIS standards.

Projects reproducing a VASAB 2010 in miniature, as it were, have also been submitted. They attempt at creating more detailed visions of spatial development for smaller parts of the BSR. Noteworthy is, in particular, a project of that kind covering northern areas of Russia, Finland and Sweden, i.e. areas where the density of population is very low, and the so-called Baltic Palette integrating, in terms of space, Baltic States with Finland and Sweden.

Some of the submitted projects are of innovative character, like that examining the impact of new communications techniques on future spatial structure of cities. Resolving the doubts whether information highways will replace traditional cinemas, supermarkets, banks and offices, and whether services now rendered in cities will no more be attached to big concentrations of population is a big challenge for a future-oriented spatial planning.

During the creation and evaluation of projects there also emerged problems lowering the efficiency of INTERREG II C in the BSR.

Firstly, the applicants found it rather difficult to meet the main requirements of INTERREG II C, including reference or relation of the project to spatial planning, as well as its multilateral and cross-sectoral nature. Potential applicants have clearly shown poor knowledge of strategic planning documents, such as ESDP or VASAB 2010. It was, in particular, the sectoral projects that could not, to a great extent, link together spatial issues with regional development. Luckily, the defaults were, for the most part, spotted at an early stage of implementation of INTERREG II C and, thanks to a series of conferences in 1996 they have been practically eliminated. As many as 22 out of 36 submitted projects were formally correct and met the requirements of INTERREG II C. Nevertheless, a few of „transport" projects have been approved conditionally or postponed till the second round owing just to the dominance of the aspect of logistics. Problems with transnationality make one also believe that multilateral co-operation in spatial planning on the regional level has, actually, started only with the advent of INTERREG II C, despite the started earlier and well-developed co-operation of national agencies.

Secondly, when comparing projects submitted at the conferences of Karlskrona and Rostock and those sent to INTERREG II C within the first round, it can be found that many projects important for spatial coherence and long-term development of BSR and located on the territory of countries in transition were not given an opportunity to be financed within the legal framework created by INTERREG II C. Such projects, provided that they create significant externalities to BSR (the fact taking place, e.g. in case of projects putting stress on preserving values of natural environment of Eastern and Central Europe combined with socio-economic development of that part of BSR) should find external sources of financing. Neither INTERREG II C, nor PHARE and TACIS create such opportunities, as the two latter programmes are not directed to support spatial planning.

Thirdly, problems of the countries in transition could be noticed, not actually in generating projects (since the later were submitted), but in formal wording and preparation thereof in accordance with requirements of INTERREG II C. The countries in question lack facilitators or project managers capable of making over ideas into a concrete project. As a result, countries in transition have managed to put less than 50% of their ideas into the existing projects and concepts of EU countries. It thus seems that Central and East European countries do not mainly need new concepts but assistance to strengthen their administrative capacity. Still, examples may be quoted of projects initiated by the countries in transition which were then joined by EU countries. More often, however, the situation has been just the opposite. The countries in transition would join the EU countries not always knowing how to keep the position of equal partners owing to financial troubles and problems in making application for PHARE or TACIS funds.

Fourthly, the main obstacle seems to lie with co-operation between INTERREG II C and PHARE and TACIS. Initially, it seemed that the establishment of PHARE/INTERREG II C within the PHARE CBC Baltic Project Facility would solve the problem of financing common spatial projects of EU countries and countries in transition in the BSR. As practice has shown it, differences between the two initiatives make a significant barrier to potential applicants. First of all, the objectives of INTERREG II C and PHARE/INTERREG are different. Whereas INTERREG II C provides support to multilateral spatial planning, it is mostly objectives related to regional development that are mentioned in connection with PHARE/INTERREG (i.e. objectives of INTERREG II C). Other differences between the two programmes are shown in the following table.

Table 2

Differences between INTERREG II C and PHARE/INTERREG (as following from Poland’s example)

As a result, there arise situations in which countries in transition cannot participate in INTERREG projects, since a particular level of authority is excluded or the project will be carried out after or at the end of the year 1999.In addition, there does not exist any fund earmarked specially to PHARE/INTERREG within the Baltic Project Facility. A prospective applicant cannot thus be sure if the application made, excellent though it might be, would win financing, adequate funds lacking.

BSR INTERREG II C should be a subject of research and analysis. The projects submitted for implementation are verified existing development strategies in the Baltic area, such as VASAB 2010 (spatial planning) and Baltic 21 (sustainable development) and, what is most important, they point to gaps, areas poorly or not fully dealt with in the strategies. The contribution of the research community into upgrading both strategies, VASAB 2010 in particular, should consist in providing analytical summary of the democratic process aimed at creation and implementation of common spatial projects, as well as in drawing conclusions and ascertaining the direction of Baltic spatial development as a result of the process. I mean here contribution of the researchers into revision of further development of the basic document for spatial development in the BSR - the Tallinn report. It is necessary to integrate the results of project-oriented co-operation into the framework of INTERREG II C, to update and state more precisely the general goals, and to define which kinds of projects and action fields could best serve the implementation of spatial development objectives. The latter issue is also of significant importance for the creation of framework for INTERREG II, which is likely to remain, after the year 1999, one of the few continued initiatives of the European Union. It is important that the INTERREG III could keep its spatial and cross-sectoral nature.

As regards the submitted projects, results of the first call do not allow, as yet, to formulate complete conclusions regarding priority directions of spatial development in the BSR from the point of view of local and regional authorities. It is not clear to what extent the projects stemmed from the needs of those interested, and to what extent the demand for such projects has been created by VASAB with its training conferences.

However, the few following observations can be the initial material for such an analysis:

• A majority of the submitted projects are minor ones. There have been few pan-Baltic projects, the fact resulting from the competencies of local authorities and sectoral ministries. Thus INTERREG II C and the co-operating with it PHARE/INTERREG require stimulation from the outside (creation of external pan-Baltic networks of co-operation, such as CSD/BSR) in order to work out large Baltic projects.
• In their projects, local authorities most often wanted to pursue strategies of lesser importance, complementing in detail the general VASAB strategy.
• Concrete urban issues were most often dealt with by local authorities, their projects being thus narrowly profiled and focused on concrete matters (water fronts, marinas), but at the same time it was mostly the local authorities that submitted many innovative projects.
• A great popularity of projects combining regional development with transport corridor development could be observed among local authorities, but a significant role of spatial planning departments was evident there.
• On the forum of the projects, sectoral ministers and their agencies went into dialogue with spatial planners making the VASAB strategies more precise, the fact being, actually, impossible to achieve at the stage of building up those strategies.
• Private businesses (harbour operators, air transport operators) joined some projects. These projects, however, were usually narrowly sectoral oriented and they had to be extended in order to bring more general benefits.

Basing on the materials of the first call it is, however, possible to formulate certain preliminary conclusions concerning the priorities of spatial development in the BSR.

It is the urban problems/urban network and transport issues that arouse the greatest interest. Attention of Baltic spatial planners is also focused on spatial monitoring and modern techniques of data transmission and processing. On the other hand, involvement in the problems of non-urbanised (special) areas, so-called patches, is very low. There has been only one project covering that aspect.

Urban projects have one feature in common. They pertain to large, yet geographically strictly separated subregions of the BSR, the project concerning Metropolitan areas being the only exclusion. Projects of the cities situated in the southern part of the BSR are aimed at promotion of regional development and creation of new urban functions, basing mostly on the tourism network. This is true about both the „Waterfronts" project, reproducing Baltic functions of harbours existing in communist times, and the project of network of marinas on the southern Baltic, being in preparation now. At the same time urban projects from the northern part of the Baltic area are focused mostly on the reproduction of VASAB’ strategy in miniature (the area of the Gulf of Bothnia and the area of BSR and Barents Sea meeting point), the role of cities in spatial and regional development being stressed. Within the framework of VASAB lack of that kind of research has been evident for a long time. The problem of cities as the driving force of BSR development, meanwhile the problem of spatial distribution of functions of the cities and a dynamic change in the scope and quality of the functions, in the opinion of VASAB requires a more comprehensive explanation (the problems appear, at least to a certain extent, in each of INTERREG urban projects). Hence a research/application project is under preparation (documentation plus policy recommendations), supposed to summarise the experience of the existing projects and suggest ways towards consolidation of urban network in the BSR.

As far as transport projects are concerned, influence of various forms of transport on spatial structures and regional development is examined. The projects in question are typical corridor projects, like that for via Baltica, the corridor along Odra river to Sweden (a few corridor projects of that kind, e.g. TEM/TER, Atlantic-Karelian corridor, Helsinki-St.Petersburg-Moscow corridor being under preparation). Innovative attempts to determine the influence of air, sea or inland water transport on regional development and development of spatial structures (cities, in the first place) are, however, also examined. Basing on the projects, it seems necessary to summarise knowledge about the tools spatial planning has at its disposal to support development of sustainable modes of transport and cross-sectoral approach to mobility network, i.e. the approach which, besides transport and environmental issues, takes into account development of towns, spatial balance, urban settlement structure, regional development etc.

Monitoring-type projects deal with technicalities of spatial planning and focus mostly on modern information techniques, including GIS. They are important, considering that common planning in the BSR requires common information standards, the latter being, unfortunately, highly varied ones. Network system of spatial planning in pan-European regions is being created only now. It is thus good that the issue has been reflected in INTERREG II C projects.

From the Rostock, Karlskrona Conference and first application round general conclusions can be drawn as follows:

• The interest among BSR actors to pursue spatial planning projects is larger than expected. This is true for all fields (except 7.2.2) covered by BSR INTERREG II C OP and inter alia VASAB 2010 strategy and ESDP document.
• The priorities picked up by OP seem important and well respond to the demand of Baltic actors. However, for the measure 7.2.2. (energy and communication) some dialogue between BSR spatial agencies and local and regional authorities seems necessary. The dialogue could be support by explanatory and know-how transfer activities.
• These two above mentioned observations lead to the conclusions that integrative territorial (spatial) approach present in INTERREG II C received positive reception from main Baltic Sea Region actors. This approach should be continued in INTERREG III replacing the sectoral orientation. Integrative territorial approach allows for horizontal co-ordination of different activities in the region creating more holistic and closer to reality picture of the regional development.
• Spatial planners should participate in sectoral working groups and try to help integrating spatial development issues there
• Spatial Planning should invite regional and local authorities and institutions responsible for sectoral policies to participate in spatial planning programmes (it has proved easier to demonstrate advantages of multi-sectoral approaches when spatial planning has a leading role)

• The regional and local governments are very active in the preparation of the INTERREG II C projects, and this leads to a better knowledge of the main European spatial planning documents among these authorities.
• The success of the INTERREG II C in the BSR is partially due to the existence of the VASAB 2010 strategy and close connections between spatial planning authorities in the BSR achieved within the VASAB 2010 framework. Out of sixteen projects approved in the first call twelve applications originated directly from the VASAB 2010 strategy.
• Therefore the VASAB 2010 strategy should be „kept alive" It should be both
• upgraded taking into consideration the results of the main ongoing INTERREG II C projects and other important regional actions like BALTIC 21,
• more practically oriented taking a form of Spatial Development Action Programme for BSR.
• The upgraded strategy should allow for better formulation of the INTERREG III guidelines. Since the INTERREG III will probably allow for medium sized investment the upgraded strategy should put more emphasis on infrastructure and other bottle necks for spatial development of the BSR. The concrete themes for infrastructure development should be defined and agreed among the BSR countries to facilitate preparation and evaluation of the INTERREG III projects.

• INTERREG II C as a one of the first attempts to integrate on the project level the EU and non EU countries of the BSR has rather succeeded, however, the participation of the transition countries is still hampered by different obstacles like lack of knowledge and experience in preparation of the projects, hardly satisfactory integration of INTERREG II C with PHARE, to name only the most important.
• There have been some projects formally ineligible under INTERREG II C due to the lack of sufficient number of EU partners but important for cohesion and spatial development of all the BSR. Therefore complementary funding from PHARE (CREDO and CBC) and TACIS supporting spatial cohesion of the BSR could be discussed if these projects create substantial positive externalities for the EU countries.
• As far as co-operation with Non-EU States in Central and Eastern Europe is concerned their specific structures have to be considered. A major issue for further European integration is the strengthening of the administrative capacity in the respective countries