Jones blames 1980s and recession for lagging economy

First Minister Carwyn Jones said Wales was still dealing with the legacy of the 1980s after damning new figures on the economy.

The performance of west Wales and the Valleys has fallen further behind the European average, despite receiving billions from the EU.

Latest figures show gross domestic product (GDP) fell by 2% in 2008.

More than £6bn has been pumped into the Welsh economy, thanks to money from the EU over the last 11 years.

Under fire from opposition parties, the assembly government said the figures were a "mixed bag".

The European Union's Statistical Office said GDP in west Wales and the south Wales valleys in 2008 was 71% of the average of other European regions - 2% down on the previous year and the lowest in the UK.

Billions of European aid has been poured in to raise prosperity.

Wales got nearly £1.6bn from the EU in 2000-06 and has received another £1.5bn since 2007. With match funding, it represents an investment of more than £6bn, most of which has gone to the west and the valleys.

Speaking on BBC Radio Wales' Phone In, Carwyn Jones said the figures were three years old.

"It's been very difficulty, we know, over the past decade and more in some parts of Wales, and we are still dealing with the legacy of the 1980s as well," he said.

"You also have to remember that as far as west Wales and the valleys is concerned, the GDP has increased there, but of course it has increased at a faster level elsewhere in the UK.

"We can't ignore the fact that there was a recession in the world in 2008. It was particularly bad at that time. I don't think it's fair to blame the assembly government for the world recession."

He said more than 12,000 people were saved from dole queues by the assembly government's ProAct scheme. Launched during the recession, it paid businesses to re-train redundancy-threatened staff.

Mike Theodoulou, chairman of the Mid and West Wales Business Chamber, was on the negotiating team that helped secure the EU funding.

He told Radio Wales: "Was the money used in the right way? Some of it was, some of it wasn't. Not enough direct support went to business. And I think that's a lesson that we have got to learn."

The Welsh Conservatives called on the assembly government to explain why the regions were faring so badly.

Shadow economy minister Darren Millar said: "This figure is a damning indictment of the economic situation Labour-Plaid has put us in.

"It is the lowest percentage of the EU27 average in any part of the UK, and it puts west Wales and the valleys on a par with areas like Yugozapaden in Bulgaria and Alentejo in Portugal."

Welsh Liberal Democrat AM Peter Black, said: "We started off as one of the poorest parts of the UK and we are now firmly entrenched in that position. That is a woeful record."

An assembly government spokesperson said: "They [the figures] show the need for Wales to continue to work to match the prosperity in other parts of Europe and the ongoing role of European funding in supporting our economy.

"However, it must be remembered that Wales is maintaining an employment level above its historical average, with the level up 123,000 since the creation of the assembly.

"Employment in Wales has increased by 10.2% since devolution, compared to a 7.4% increase for the UK as a whole over the same period."