Negotiators from Parliament and the Danish Council Presidency have agreed provisionally on a mid-term update to the EU’s current cycle of cohesion policy funding, which aims to reduce regional inequalities through the European Regional Development Fund, the Cohesion Fund and the Just Transition Fund.

The changes will offer member states and regions more flexibility to channel funds into new objectives, namely defence industrial capabilities and military mobility, water resilience, affordable housing, decarbonisation, strategic technologies, and energy infrastructure. The reform also allows for extra support for EU regions bordering Russia, Belarus and Ukraine, highlighting their special needs in a tense geopolitical environment.

To inject liquidity quickly into the new priorities, it was agreed that this spending can benefit from i.a. co-financing rates 10 percentage points higher than normal and of 20% one-off pre-financing for amounts re-allocated in 2026.

Investment in civil…