This paper brings together evidence of the territorial and policy implications of the COVID-19 pandemic with the long-term strategic thinking in regional policy in the past twelve months. It shows that, in the period 2020-2021, governments dealt both with the immediate unpreceded impacts of the pandemic crisis as well as developments in regional policy that were rooted in challenges preceding the pandemic.
The recovery from COVID-19 is underway but the path ahead remains uncertain. National economic activity is still behind pre-crisis levels, and the sectoral and territorial impacts of the pandemic and recovery will vary.
Regional policy has played mostly a secondary role in responding to the economic impact of the pandemic. Regional support across European countries depended largely on the established political priorities of government authorities, existing institutional frameworks and regional policy instruments, and their geographical scope. Instruments were, however, recalibrated in terms of budgetary allocation, duration, eligibility and output requirements to suit specific crisis-related needs. Support measures have been devised in some countries to assist hard-hit areas or structurally weak regions.
So far, there is limited evidence that the pandemic has influenced the strategic regional policy thinking. Regional policy developments over the past 12-18 months have been driven primarily by long term political and policy priorities.
The pandemic hit at a time when governments were already dealing with complex territorial inequalities and widening regional differences in economic growth challenges. Recent regional policy developments have focused on intensifying support for equalising territorial development, targeted territorial stimuli, the efficiency and effectiveness of policy and the timely response of regional policy to ‘grand’ societal challenges. These changes indicate an increased commitment to combatting territorial inequalities and supporting regional growth potentials in a more integrated and multifaceted manner, recognising place-specific development trajectories and involving multiple actors.
As the effects of the pandemic on society, economy and territory further evolve, it is expected that these will have implications for regional policy. Will the pandemic speed up ongoing policy trends? Or does this represent a ‘critical juncture’ calling into question existing policy approaches and institutional and territorial arrangements?