Boosting the regional economy

GRW funding is dedicated to those regions that are structurally weak. There are three equally important objectives pursued by the Federation and the Länder through the GRW in regions that are structurally weak:

• offsetting disadvantages affecting commercial activity;
• creating and safeguarding jobs, boosting growth and prosperity;
• accelerating the transition to a climate-neutral and sustainable economy.

GRW funds are used to support investments by trade and industry, investments in local commerce-related infrastructure, measures designed to encourage networking and cooperation between local players, measures designed to improve competitiveness, particularly that of SMEs, and measures to uphold regional public services.

The success of the GRW so far speaks for itself: since the beginning of the 1970s, the Federation and the Länder have jointly spent a total of €82 billion under the Joint Task, thus enabling nearly 157,000 investment projects undertaken by trade and industry and expanding the local commerce-related infrastructure worth approximately €390 billion. A total of 4.9 million jobs have been created or safeguarded at the assisted companies.

Regular evaluations of GRW funding for commercial enterprises clearly demonstrate the positive effects of the programme, both on the development of the assisted enterprises, and at the level of the assisted regions in general.

The basic guidelines for the GRW, the map of Assisted Areas, the instruments available and the rules and maximum funding rates that apply are all set out in the “coordination framework” (PDF, 2 MB) which is agreed between the Federation and the Länder. The funding rules transpose the European rules on national regional aid the General Block Exemption Regulation into national law. The exact terms and maximum rates of funding that apply under the GRW vary depending on the level of structural weakness/needs of the region. The Länder are solely responsible for executing the GRW funding.

The areas receiving assistance under the GRW (Assisted Areas) were newly defined for the funding period of 2022-2027. The map of Assisted Areas for all of Germany (PDF, 2 MB) shows which areas are receiving funding in the period that started on 1 January 2022. The GRW was comprehensively reformed at the end of 2025. More information about the revisions can be found here.

The GRW is a key component of the Federal Funding System for Structural Development Regions, which was established in 2020, relaunching regional assistance and placing all of it under one umbrella for the first time.

Structural Strengthening Act for Mining Regions

The Structural Strengthening Act for Mining Regions entered into force on 14 August 2020. Lignite-mining areas will receive up to €14 billion in financial assistance until 2038 for significant investments. In addition, up to €26 billion has been earmarked for further measures within the remit of the Federal Government, including top-ups for research and support programmes, the expansion of transport infrastructure projects, and the establishment of federal institutions in the areas affected. Further support has been announced for selected hard-coal sites as well as Helmstedt and Altenburger Land, formerly the sites of opencast lignite mines. In order to give political backing to the implementation of this mammoth task and to choose the right projects along the way, the Federal Government and the Länder are working together closely via a coordination body established for this purpose.

What do artificial lakes created by flooding open-cast mines, the development of innovative technologies for the recycling of lithium-ion batteries and projects to support women from foreign extraction as they enter the job market have in common? They are all financed through European Regional and Structural Policy, which supports projects undertaken by small and medium-sized enterprises (SMEs), research institutions, welfare organisations and municipalities and also cross-border cooperation. The EU treaties state that the EU aims to strengthen economic, social and territorial cohesion within the EU and to reduce disparity between different regions. Beyond this, European Regional and Structural Policy addresses the challenges caused by climate change by fostering the transition towards an innovative and resource-efficient economy.

During this current funding period from 2021 to 2027, around a third of the EU budget – €378 billion – goes to the Structural Funds supporting the goals of European Regional and Structural Policy. Germany receives €21 billion of this funding. Of this sum €11 billion comes from the European Regional Development Fund (ERDF), which serves to strengthen companies’ competitiveness and to create jobs in SMEs. In addition to this, there are investments in research and technological development and in the reduction of emissions that harm the climate. The European Social Fund Plus (ESF+) is worth €6.5 billion in Germany and serves as the EU’s most important tool of employment policy. The ESF+ helps jobless and young people as they enter the job market, supports those wishing to establish their own business and provides financing for measures to promote equality.

At least one third of the funding from the Structural Funds is dedicated to climate action. The EU supports adjustment to climate change not only through the ERDF and ESF+, but also and especially through the newly created Just Transition Fund (JTF). This fund, which was created as part of the European Green Deal, supports regions and communities that are particularly affected by the energy transition as they mitigate its negative effects and seek to ensure that the ensuing structural change is socially just. In Germany, a total of €2.5 billion is available for the Länder of North Rhine-Westphalia, Brandenburg, Saxony and Saxony-Anhalt during the current funding period.

In Germany, the Federal Ministry for Economic Affairs and Energy is responsible for coordinating EU Structural Policy and the funding from the ERDF and the JTF. The implementation of funding programmes financed from the individual funds falls largely into the remit of the Länder.

For further information about the European Structural Funds and the implementation of programmes in Germany, please click here.