Bridging Regional Development and Sustainability: The Contribution of the European Regional Development Fund to Sustainable Development Goals Progress in the EU

The primary focus and innovation of this study lie in examining the role of the European Regional Development Fund (ERDF) in advancing the implementation of the Sustainable Development Goals (SDGs) across the EU member states during the 2015–2023 period. For this purpose, the EU member states were categorized into two groups: Group A (lower-income states) and Group B (higher-income states). This study utilized ERDF payments as the independent variable, while 17 SDG indicators were treated as the dependent variables. The methodology combined an Exploratory Factor Analysis (EFA) with robust regression techniques to explore the relationships between ERDF allocations and SDGs. This study highlights that the associations between ERDF allocations and SDGs progress are shaped by variations in the socio-economic contexts, institutional capacities, and developmental priorities across the different clusters. While tailored strategies reflecting these distinctions have been increasingly adopted to ensure that investments address immediate challenges and foster long-term sustainability, this analysis underscores the need for the continuous refinement of these approaches to maximize their effectiveness. In less developed regions, a focus on capacity-building initiatives and targeted administrative support is essential. Conversely, in more developed regions, prioritizing innovation, green technologies, and inclusive development can maximize the transformative potential of the funds. By aligning the funding mechanisms with the specific needs of the regional contexts, the ERDF can more effectively contribute to the European Union’s objectives of achieving the SDGs and bridging regional disparities.