The Barcelona European Council By Edward Bannerman The EU’s ten-year plan to transform itself into “the most competitive and dynamic knowledge-based economy in the world by 2010” is running out of steam. The forthcoming summit in Barcelona on March 15th and 16th needs to reenergise Europe’s faltering commitment to the ‘Lisbon agenda’ of economic reform. Many Europeans like to think of their continent as a global economic superpower. But when compared to the US over the last decade or so, Europe looks like a laggard. From 1990 to 2000, the EU achieved only one year of economic growth above 3 per cent. In contrast, the US economy experienced just one year in which its economy grew by less than 3 per cent. The gap between GDP per capita in Europe and America is now at its highest level since the early 1960s. To tackle this under-performance, EU leaders, meeting in March 2000 in Lisbon, agreed on an ambitious ten-year programme that was designed to raise Europe’s GDP by around 40 per cent and create 20 million new jobs. But the EU has made only limited headway, with many deadlines already missed. Spain, a strong advocate of structural reform and current holder of the rotating EU presidency, will host this crucial gathering of EU leaders to review progress. British Prime Minster Tony Blair has even described the Barcelona summit as “make or break” for the EU’s economic reform agenda. However, the current political and economic environment continues to present a number of obstacles to progress. The effect of the global downturn has made many member-states reluctant to embark on the kinds of bold economic restructuring that may result in short-term job losses. Elections later this year in France and Germany have further muted discussion of radical reforms and the hard choices that Europe faces. CER experts will be in Barcelona to provide commentary on the forthcoming European Council meeting. The CER will also publish its comprehensive, annual assessment of progress in implementing the Lisbon agenda shortly after the summit. “The Barcelona Scorecard: the status of economic reform in the EU-25” will also include a review of performance by EU candidate countries. Please see the CER website (www.cer.org.uk) for more information or contact: Edward Bannerman Heather Grabbe
Head of business and economics Research director
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