Balearics among Europe's most vulnerable regions because of the pandemic

The president of CoR, Apostolos Tzitzikostas, says that regions to have registered the highest numbers of infections and deaths are not necessarily the hardest hit economically. The economic impact depends on containment measures and factors such as the proportion of employment in the most affected sectors; the dependence on tourism and foreign trade; the population at risk of poverty and social exclusion; the youth unemployment rate; and the number of small to medium-sized businesses (SMEs) and the self-employed.

Taking all these into account, six Spanish regions are classified as being most vulnerable - Andalusia, Castile and Leon, Catalonia, Madrid and Valencia as well as the Balearics.

In southern and eastern European regions, there is heightened vulnerability because of, for example, the number of SMEs and self-employed, while Mediterranean and alpine regions are vulnerable due to the dependence on tourism.

The report highlights the fact that local and regional authorities have been at the forefront of managing the health crisis and that this has had a significant impact on their budgets. In Italy and Spain, regional authorities are bearing up to 90% of health spending. This is producing a "scissors effect" - less income because of loss of economic activity and higher public spending - which has meant a rapid deterioration of local and regional finances. This will be accentuated by the uncertainty surrounding the duration of the crisis.

A conclusion that the report draws, therefore, is that economic recovery plans should be adapted to the specific needs of regions and be based on careful analyses of regions. The distribution of the European recovery fund should be based on socioeconomic vulnerability and the structure of regions. This means following criteria such as the dependence on tourism, international transport and the level of self-employment.