Rhodri Morgan said Brussels was satisfied

The Commission is backing the Welsh Assembly administration's plans to spend �1.13bn in aid for the poorest parts of Wales.

Assembly First Secretary Rhodri Morgan had already confirmed that Brussels was satisfied with proposals for Objective One aid.

Mr Morgan said the first project expenditure should be before the end of July.

"Now we can confidently say that we have made a major stride forward today in trying to bring up the economic performance of the two thirds of Wales that has been lagging behind," he said.

Modernise industry

"We hope that within four or five week we will actually be approving real projects for spending money this year."

It is hoped that together these programmes will bring an equivalent of 154,000 new jobs and will provide training in skills for 420,000 people UK-wide.

The approval has been welcomed by the Catherine Eva, head of the European Commission in Wales.

She said the funding would enhance the competitiveness of west Wales and the Valleys, modernise industry, improve skills and promote an information society.

But the Welsh Liberal Democrats claimed on Monday that the government was deliberately "stalling" on proposals to offer vital tax breaks for Objective One areas.

Welsh Liberal Democrat leader Michael German said that a new report to the economic development committee demonstrated the Treasury's 'breathtaking ignorance' in failing to grasp the needs of the poorest parts of Wales.

Alan Cairns, the Welsh Conservative spokesman on economic development and Europe said: "I welcome the announcement that the Welsh SPD has been accepted by Europe.

"We have lost almost seven months of the programme because of the delay in having the document accepted by Europe so we must ensure that matters proceed as quickly as possible from now on."