Reforming the Lisbon Strategy

They came, they talked but they achieved very little. The spring summit brought together the leaders of the EU's 25 countries and was meant to mark a new start for the Lisbon Strategy. After the fiasco with its proposed Constitution, the EU was determined to stick to bread and butter issues. And these days few things matter more to people than jobs and economic growth.

These are difficult and testing times for the EU. Gone is the euphoria of having extended its borders to Russia and Africa. The pain of digesting this expansion is bound to be felt for some years to come. In the meantime, many of the EU leaders feel politically threatened at home. A new sense of nationalism and protectionism is creeping in and this is rocking the very foundations of the EU's single market. Globalisation is no longer regarded as the panacea for all the world's ills. Too much of a good thing can be equally harmful. Millions of China-made garments are stockpiling Europe in what has been described as "bra wars", the controversy over textile quotas.

France seems to be at the eye of the cyclone. After the riots by its Muslim, marginalised minority, it has been the turn of its youth to take to the streets. Having a 23 per cent chronic youth unemployment rate is no joke. Indeed, one of the measures that had been proposed by the Austrian presidency for the summit was to offer a job, an apprenticeship, additional training or some other employability measure within six months.

France had been severely criticised for having sought to thwart a potential bid by Italy's Enel for its energy group Suez, by merging the latter with Gdf. The French have gone so far as identifying 11 strategic business sectors that are to be shielded from "foreign" bidders. Italy itself is being investigated for obstructing the takeover of some of its banks. Luxembourg has resisted a takeover of the steel maker Arcelor by Mittal Steel. Spain and Poland too are being investigated for breaches of EU law.

President Jacques Chirac was betrayed by his frustration when he stormed out of the summit meeting, because the French president of Unice, the European employers' federation, was delivering his address in English. This made news, the rest passed away unnoticed. As the Swiss newspaper, Neue Zurcher Zeitung, commented "the summit delivered nothing to the 19 million jobless in the EU" apart from a claim that it will create six million jobs between 2005-2007 helping to reduce overall unemployment by one per cent.

The Austrian presidency was keen to have the summit agree on specific targets for jobs and growth, investment in innovation as well as higher use of renewable energy sources. This approach had the full support of Commission President José Manuel Barroso, who had indirectly blamed the Prodi administration for parts of the failure of the Lisbon Strategy. Mr Barroso believes that the Commission should stick to a role of initiating policy and ensuring implementation. The rest lies with the member states, whose commitment and ownership of the Lisbon Strategy is now deemed as being critical for success. The social partners and citizens too are being given a bigger say in the implementation of the strategy. This has given start to a campaign known as the Partnership For Growth And Jobs, which aims to get all the stakeholders behind the Lisbon Strategy.

To ensure this commitment, the member states were asked to prepare a National Reform Programme (NRP), and they will be expected to report on a yearly basis on the progress being achieved during the spring summit. Reform has become the pivot of European economic policy. Reform not for its own sake, but as a strategy for enhanced productivity through a better utilisation of human and other resources.

The EU has decided not to impose sanctions nor to "name and shame" member states that fail to perform adequately. The Commission realises that the litmus test of the Lisbon Strategy lies in its implementation. As Wim Kok, the former Dutch Prime Minister, who was asked by the European Council to head a high-level group to review the Lisbon Strategy, pointed out, "time is running out and there can be no room for complacency. Better implementation is needed to make up for lost time".

Last November, Malta launched its own NRP which essentially followed the guidelines and priorities which had been set by the Commission itself. In its assessment of our NRP, the Commission remarked that there was not sufficient emphasis on competition issues. It also called for a reduction in the tax burden on labour and for rendering work more attractive through a comprehensive review of the tax and benefit system.

Two European think tanks have just published their own assessment on the progress achieved in the reforms strategy. Bruegel placed Malta in mid-table with regard to ownership of the Lisbon Strategy. We got six out of 12 points, having missed out completely in involving civil society in the preparation of the NRP. The Centre for European Reform, which prepares the Lisbon Scorecard, fails to rate Malta "due to the unavailability of information". Last year, we were classified last. A strange co-incidence indeed.

There is little doubt that jobs and economic growth should be of concern to each one of us. Creating more and better jobs is not just another political project, but a social necessity. Delivering stronger and more sustainable economic growth will make available the economic resources needed to meet our political, social and environmental aspirations. In this, we surely share the same vision as the other EU countries. Whether our political leaders have what it takes to make it happen is another matter.

fms18@ maltanet.net