The state of regions and cities | HIGHLIGHTS

EU annual report 2026

Two smiling politicians, a woman in beige and a man in a gray suit and green tie.

Kata Tüttő

President of the European Committee of the Regions

Juanma Moreno

First Vice-president of the European Committee of the Regions

Europe is under pressure to become faster, stronger, and more competitive, but to do so it must become stronger from within. Long-term competitiveness and resilience depend on our ability to harness the diversity and potential of our cities and regions. Economic strength, social cohesion, and democratic legitimacy are best achieved through a place-based approach that enables all territories to contribute to the Union’s prosperity.

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STRONG REGIONS,
STRONG CITIES,
STRONG EUROPE

Europe cannot become stronger globally if it weakens its internal cohesion. Yet the proposed Multiannual Financial Framework risks undermining the very foundations of the EU project. Its centralised architecture limits regional involvement, weakens cohesion policy, and deepens territorial disparities.

Regional Thermometer

Regional improvements in the selected indicator including unemployment rate, persons at risk of poverty, and vulnerability

Source: Administrative boundaries: © EuroGeographies © OponStreetMap

Cartography: Eurostat - IMAGE, 08/2025

deteriorated

improved

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COMPETITIVENESS
NEEDS COHESION

Industrial transformation requires a place-based EU industrial policy that aligns investment with regional needs, prioritises decarbonisation, modernises energy infrastructure, streamlines permitting procedures and provides predictable support for the just transition, thereby strengthening both competitiveness and fairness.

30 million

Europeans depend on manufacturing jobs

5 times

more intra-EU trade could be unlocked by removing remaining border effects and barriers within the single market

Using small loans to reshape regional cohesion delivery

Lazio region, Italy

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NO SECURITY
WITHOUT RESILIENCE

EU regions are asymmetrically vulnerable and unevenly impacted. They need stronger EU solidarity funding to step up climate adaptation, preparedness and resilience. Effective action also requires multilevel governance and technical capacity assistance.

It is estimated that

96 000

Europeans per year will lose their lives to heatwaves by 2100 under a 3°C warming scenario

Every

EUR 1 billion

spent on water resilience could create 16,000 EU jobs and generate EUR 2.35 for every euro invested.

Transforming a harbourfront into a climate-resilient park

Ebeltoft, Denmark

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RIGHT TO STAY UNDER PRESSURE

Ensuring the “right to stay” requires substantial investments in local jobs, housing, access to essential services, connectivity and quality of life everywhere. Cohesion policy must remain strong to foster integrated strategies for territorial revitalisation.

135 million

Europeans live in regions trapped in stagnation or decline, especially in rural and peripheral areas

3 in 4 regions

are expected to lose population by 2050, notably in rural areas

Bringing new life to small villages

Community of Madrid, Spain

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