THE LISBON STRATEGY Relaunch or last rites

1
THE LISBON STRATEGYRe-launch or last rites?

• Iain Begg
• Visiting Professor, European Institute London
  School of Economics

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LISBON FAULT-LINES

• Strategic aims and policy goals valid
• But shifting priorities undermine consistency
• Specific objectives more doubtful
• Few demonstrate case for Community level
• Policy instruments have been inadequate
• Problems with incentives
• Lack of budgetary means at Community level
• Action plan fatigue? Target proliferation?
• OMCs shortcomings

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THE DELIVERY FAILINGS

• The underlying growth rate failure
• Debilitating effect on all dimensions of reform
• Key targets being quietly shelved
• Little sign of advances in RD or innovation
• 2010 employment rate target beyond reach by 2004
• Backsliding on Kyoto aims
• Large disparities among the Member States
• Leaders Nordics
• Laggards France, Germany , especially, Italy

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VARYING GEOMETRIES ILisbon 2000
KNOWLEDGE-INTENSITY Competitiveness
Economic Reform 2010
Social Cohesion
JOBS
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VARYING GEOMETRIES IIGothenburg 2001
Competitiveness
Sustainable Development LONG-TERM
Social Cohesion
Environment
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VARYING GEOMETRIES IIIRe-launch 2005 curing the
sick child
GROWTH
Jobs
Economic Governance Reforms DEADLINE?
Social Cohesion
Environment
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KOK RECOMMENDATIONS

• Focus advocated on five aims
• Advancing the knowledge society
• Further efforts to complete internal market
• More supportive business climate
• In particular, curbing obstacles to
  entrepreneurship
• Building an inclusive labour market
• Boosting more eco-efficient technologies
• All to be advanced by National Action Plans
• plus putting the delinquents in the dock

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AND THE RE-LAUNCH?

• Another accurate diagnosis
• Another re-statement of the imperatives
• Another obligation to produce action plans
• Another commitment to community action
• but scant means
• and even probability of budgetary curbs
• A fresh call for MSs to take ownership
• but no naming, blaming and shaming

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TRAJECTORY OF ECONOMYThe supply-side reform
j-curve
Performance
With extensive Structural reforms
Without major reforms
Time
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IS THERE A SOLUTION?

• Member States do know whats needed
• Overcoming political inertia
• Essentially a Member State challenge
• Requires a perception of crisis
• Community level may now be counter-productive
• Macroeconomic dimension cannot be ignored
• Review and clarify purpose of co-ordination
• In particular is it genuinely adding value?

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The promotion of growth and employment in Europe
is the next great European project.

• Kok report, November 2004

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THE LISBON STRATEGYRe-launch or last rites?

• Iain Begg
• Visiting Professor, European Institute London
  School of Economics