Wednesday, April 13, 2005

EU Lisbon Strategy & the Euro-Mediterranean partnership

The Lisbon Strategy of the EU always looked ambitious, and without fundamental reform in many of the major EU member states it will continue to remain over ambitious. The reasons why the EU is having to restart the Lisbon Strategy, as enumerated below, will continue to remain stumbling blocks.

Why do we need a new start for Lisbon?

- Insufficient progress has been made to reach the Lisbon objectives.

- Although EU productivity levels were growing faster than those in the US for five decades, since 1996 the EU has been lagging the US every single year. Labour productivity in the US is now growing twice as fast as in Europe. As a result our relative levels of wealth have also started slipping.

- Europe is not investing enough: investment has – on average – been growing by only 1.7% per year compared with 5.4% per year in the USA.

- We are not spending enough on Research & Development: the USA is spending about €100 billion more on R&D than Europe. The EU has only 25% of the number of patents per head of population found in the USA.

- Finally, while in the USA 32% of population has university or similar degree, this percentage stands at only 19% in Europe. In addition, the USA is also investing about twice the amount per student as most European countries.

- These trends, if not addressed, will drag down the potential growth rate to slightly over 1% - or a third of the Lisbon objective.

- In 2004, the average growth of the Euro area was a meagre 2.2%, while the US economy grew by 4.3%, Japan by 4.4%, India by 6.4% and China by 9%.

- We need to revamp the Lisbon Strategy because the delivery process which has become too complicated and is poorly understood. It generates much paper, but little action. Responsibilities between the national and the European level have become blurred. Limited ownership of member states is the result.
The above quoted text is from a rather cryptically titled Commission press release -
The new integrated employment and economic guidelines

That last line, "Limited ownership of member states is the result", is a rather curious statement.

The EU also has very ambitious plans for a number of non-EU countries which also appear to be over ambitious, if not unrealistic. See the Five year plan to reinforce Euro-Mediterranean partnership

The target dates for the above "plan" are likely to go the way of the Lisbon Strategy target dates. Looking at some of the proposals I wouldn't be surprised if, on some issues, the EU doesn't find itself coming into conflict with local cultural and religious values. The countries concerned are Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Palestinian Authority, Syria, Tunisia, and Turkey. Libya apparently has “observer status”.