| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 Asia Economy


How to use our RSS feed

Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.


Finfacts is Ireland's leading business information site and you are in its business news section.

We provide access to live business television and business related videos from: Bloomberg TV; The Wall Street Journal; CNBC and the Financial Times. Click image:


Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Irish Economy

Global Income Per Capita

Global Cost of Living

Irish Tax 2008

Climate Change Reports

Global News

Bloomberg News

CNN Money

Cnet Tech News


Irish Independent

Irish Times

Irish Examiner

New York Times

Financial Times

Technology News




Content Management by interactivetools.com.

News : EU Economy Last Updated: Sep 18, 2009 - 12:14:10 PM

A post-Lisbon Agenda growth strategy to make the EU fit for the future
By Finfacts Team
Sep 18, 2009 - 8:10:04 AM

Email this article
 Printer friendly page

José Manuel Barroso at the European Parliament on Wednesday, Sept 16, 2009, after his reelection as president of the European Commission.

Deutsche Bank Research says now that the first green shoots of recovery have appeared, the time has come to look  ahead. With regard to the EU, above all a debate on the future growth strategy is called for. This applies all the more as the Lisbon Agenda will expire next year and the structural challenges have become even greater as a result of the crisis. But what should such a post-Lisbon Agenda (this does not refer to the Lisbon Treaty on institutional reform) look like?

DBR economist Tim Sprissler, writes that the political agenda is in the firm grip of economic crisis throughout the EU. Short-term measures to mitigate the crisis and fight the fall in demand are prevailing. He says there is not much scope for looking beyond today, and medium-term strategy has taken a backseat. But this may take its toll since the structural challenges facing our modern economies have not been eliminated - - rather, the need for a solution to the problems has become even more compelling as a result of the crisis. Now that the economy is showing first signs of a recovery, the time has come to look ahead. With regard to the EU, discussion about exit strategies from the massive government support programmes and above all a debate on the EU’s future growth strategy should be on top of the agenda. Global competition, technological progress towards the information society, climate change and not least the ageing of societies require immediate action. This holds all the more true as the Lisbon Agenda will expire next year.

Sprissler says the record of the Lisbon Agenda agreed by the EU heads of state and government in 2000 is mixed at best. The strategy aimed to make the EU fit for the future by coordinating reform efforts in the member states. To foster the development towards competitive and dynamic knowledge-based economies with high employment the EU member states were to heavily invest in R&D, education and training. In some of the many targeted areas progress has been made in the last few years. Nevertheless, the crisis jeopardises important achievements, e.g. with regard to employment ratios. In other areas, such as productivity growth and investment in R&D, many EU member states had difficulties even before the recent setbacks, however.

He says due to the mixed results of the reform effort to date and more urgent immediate problems such as fighting the economic crisis, the discussion on a post-2010 strategy is in danger of petering out. This would be extremely short-sighted and risky as the crisis has overshadowed the structural issues but at the same time exacerbated them. If the need for reform continues to be neglected, prosperity and social cohesion in the EU will be at stake.  This is why, a stress test which indicates whether the EU is adequately prepared for future challenges and how it may become better equipped for them is urgently needed. Maybe using such crisis vocabulary would make it easier to “sell” the required regearing of the EU member states’ coordinated reform strategy which taps synergies.

The economist asks what should such a post-Lisbon Agenda look like? Which objectives should it pursue?

Sprissler says the drive of the current Swedish presidency of the Council of the European Union to open the debate on the future growth model should be welcomed. Sweden is seeking to turn the EU into an eco-efficient economy, to increase the EU’s international competitiveness, to fight the impact of the demographic challenge and to re-establish fiscal sustainability. However, these goals do not obtain full approval; in particular the first item is controversial. For example, the European Commission and some member states, i.a. Germany, want to stick to the current focus on growth and employment. The debate should not give rise to an artificial  trade-off between growth and an eco-efficient economy, though.

Eco-efficiency, which according to the definition of the Swedish Presidency means the creation of more goods and services while using fewer resources and creating less waste and pollution, does not necessarily contradict continuing economic growth. Indeed, investment in the efficient use of resources can increase the competitiveness of an economy on the basis of the development of innovative technologies and the reduction of production costs. Here, a good example is Germany’s mechanical engineering industry since it has benefited from the production, use and export of eco-efficient technologies in recent years. Sprissler says if eco-efficiency does not mean stricter regulation without international coordination, the goals of delivering stronger, lasting growth and an eco-efficient economy can be jointly pursued in a post-Lisbon Strategy. Stricter regulations in the environmental area should in principle only be incorporated if an international consensus on climate change which minimises potential competition losses by coordinating climate protection efforts can be reached at the end of the year in Copenhagen.

Tim Sprissler says in shaping its future growth strategy, the EU should leave behind overly ambitious, all-encompassing targets and focus preferably on more efficient incentive mechanisms for initiating the required national reforms and improving their coordination. The mixed results of the Lisbon Agenda to date are not mainly attributable to the wrong targets - - rather, they are due to the fact that many countries having promised reforms have seldom lived up to their pronouncements. As the upcoming tasks mostly fall within the competence of the member states, the Commission has to rely on soft forms of coordination in order not to dilute the member states’ rights. He says the Lisbon Agenda’s “open method of coordination” provides the framework for cooperation between the member states and offers the opportunity of benchmarking reform efforts. However, the pressure to reform obviously remains too small as there is no ranking with active naming, praising and shaming. As experience shows, though, this type of public pressure seems to be required for reform-weary member states to take action. Only with a clear willingness to change and drive for reform will it be possible to make the EU fit for the next decade.

Related Articles

© Copyright 2009 by Finfacts.com

Top of Page

EU Economy
Latest Headlines
Eurozone manufacturing/ services at 3-year high
Eurozone annual inflation confirmed at 0.5% in March 2014
Eurozone industrial production inched up 0.2% in February
Draghi signalls action on deflation/ high euro within two months
IMF says Eurozone has to cleanup both banks/ corporate balance sheets
German exports fell in February; Imports slightly rose
Industrial production rises in Germany and Spain in February
ECB study shows €1tn of QE would raise inflation by just 0.2 to 0.8 percentage points
Eurozone retail sales fall marginally in March
ECB governors discuss quantitative easing
ECB keeps key interest rate at 0.25%
Eurozone Services Business Activity Index fell slightly in March
Spanish unemployment in sharpest fall in March since 2006
Eurozone unemployment rate at 11.9% in February; Italy at record 13%, Austria at 4.8%, Greece 27.5%
Eurozone manufacturing recovery slows as growth returns to France
Eurozone closer to deflation as annual inflation dips to 0.5%
China set to name Frankfurt as yuan/ renminbi trading hub
EU average 2013 hourly wage cost at €40 in Sweden, €29 in Ireland and €4 in Bulgaria
Germany identifies six key export growth markets of the future
France: Unemployment rises 0.9% in February to record 3.35m
German consumer confidence remains at a seven-year high
German business confidence hit by Ukraine crisis in March
A full trade boycott by the EU would have a major impact on Russia
Eurozone recovery prospects brighten as France returns to growth
EU banking union moves towards the launch pad
Corporate Tax Avoidance: Zara fashion brand owner amasses $10bn property empire
Diverging trends in business insolvencies in Germany and France
Eurozone annual inflation fell to 0.7% in February 2014
Italy: Renzi announces $10bn package of tax cuts/ other measures
Eurozone industrial production fell slightly in January 2014
Luxembourg stalls agreement on EU tax evasion law
ECB issues guidelines on bank tests; UniCredit of Italy reports loss of €14bn in 2013
German economic recovery on track as imports, exports rise in January
Bayern Munich president admits extensive tax evasion
Germany's foreign population rose by 419,900 in 2013
ECB and Bank of England keep benchmark interest rates unchanged
Eurozone retail PMI data shows fall in trade in February
European Commission warns on size of Germany's current account surplus
Eurozone retail trade up 1.6% in January 2014
Upturn in Eurozone services sector extended to seven months in February