Regional dynamics in mountain areas and the need for integrated policies

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simply, both should be considered as necessary conditions, but not sufficient instruments for regional
policy.

Assessment of current mountain area policies in Austria

The EU accession in 1995, along with the changes in the neighbouring CEECs, have been the
greatest shifts for the regional economy and also for Austria's mountain policies in recent time. In the
EU accession negotiations, Austria therefore had endeavoured to reach agreement on maintaining the
previous system of support for mountain farming as this constituted the primary policy in this aspect.
In particular, the direct payments in the form of the former mountain farmers' allowance had enabled
higher compensation payments for mountain farmers with greatest difficulties and with low household
income. As the EU was not prepared to extend the system of compensatory allowances at that time
Austria, however, made an effort to succeed in agreeing the possibility of a national grant for a
transitional period. This national grant covers the loss for those farmers, who would have had to
suffer from the shift to the compensatory allowances system a reduction of their specific direct
payments. This national aid is limited to 10 years. A transitional arrangement was also created as
regards investment aid to small farmers and part-time farmers, and the road development of rural
areas continues to be supported (although from national funds, and only EU co-funded in the context
of Objective 1 and 5b-programmes).

With Agenda 2000 reforms also the system of support for less-favoured areas, including mountain
areas, is undergoing some changes. It is the political intention to use the greater flexibility allowed
under the new regulation to introduce a payment providing basic support to mountain farm. This new
payment from 2000 onwards will try to incorporate some of the advantages the old system prior to
EU-accession had. In particular, small farms and farms with greatest difficulties should be supported
again stronger.

The adoption of EU-policy brought about more drastic alteration for regional policy itself. Many
objective 5b areas and partly also objective 2 areas are lying in the mountain areas. In addition, the
Community initiatives LEADER and INTERREG were applied in many mountain regions. One can
estimate that about two third of these programmes were relevant to the mountain areas which implied
a considerable increase in regional funding. It also led to a new step in Austria’s regional policy. The

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