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Globalisation has brought enormous benefits to the less-developed economies of the world and many opportunities for Europeans; but while the benefits are widely spread, the costs are often borne unevenly as the Commission's reflection paper on harnessing globalisation highlighted. To take up the challenge of economic modernisation, Europe needs to empower its regions and help them create value. This means embracing innovation,

digitisation, decarbonisation and developing people's skills.

Introduced in 2014 in all regional policy programmes, the smart specialisation approach has proven to deliver. The Commission intends to build on this positive experience with two pilot projects: Tailored support for the specific challenges of regions facing industrial transition: on their request, certain regions can work in partnership with teams of Commission experts to boost their innovation capacity, remove investment barriers, equip citizens with the right skills and prepare for industrial and societal change, on the basis of their smart specialisation strategies.

Interregional innovation partnerships supported by EU funds: inspired by the success of theVanguard initiative, the aim of this pilot project is to identify and scale up 'bankable' interregional projects that can create European value chains in priority sectors such as big data, bioeconomy, resource efficiency, connected mobility or advanced manufacturing.

In parallel, the Commission will step up its efforts to help Member States address remaining bottlenecks to growth and establish business-friendly environments. Particular attention will be given to the quality and openness of public research, cooperation between businesses and universities and the alignment of local skills-bases with market demands, with the help of Commission support facilities. The Commission will also look at ways of facilitating further synergies and combinationsbetween the different innovation, growth and competitiveness EU programmes and instruments that currently exist.

Next steps.  The calls for interest for the industrial transition regions pilot action will be launched in the autumn this year. The interregional partnerships will be set up during 2017 and run throughout 2018.

The experience acquired so far with current Cohesion policy programmes, together with the actions and policy solutions put forward in this communication, will provide useful input in preparing the next budget framework, in the context of the ongoing reflection on the future of EU finances.

The Commission will consider stronger linkages between existing EU instruments with the common objective of responding to new industrial challenges. Smart specialisation could be scaled-up, to make it a comprehensive tool to help all regions take advantage of the changes brought by globalisation.