Rethinking the “Lisbon Strategy” – Is it the right agenda for a “New Europe” and economic development

Remember “Lisbon Agenda”? Launched in 2000, it was a program intended to solve the European “growth problem” through setting a number of specific targets such as

  • Improving EU´s competetiveness, f.e. by increasing R&D spending up to 3% of GDP
  • Reforming the European social models, f.e. by increasing the employment rate up to 70%

This strategy will make Europe “the most dynamic and competetive knowledge-based economy in the world” by 2010, which would bring with it better jobs, more social cohesion and greater respect for the environment. A solution to reach this is “Flexcurity” which can be described as a welfare state model with a pro-active labour market policy. The model is a combination of easy hiring and firing (flexibility needed by companies) and high benefits for the unemployed (security needed by the employees).

However, due to today´s economy the Lisbon Agenda has not lived up its hopes. “The reality is that Europe will not achieve the objectives for 2010, if at all”, says the LSE Centre for Economic Performance (CEP), in a new report addressing the need to boost innovation and increase productivity in Europe.

European unemployment increased more than economists expected in February to the highest in almost three years as the recession forced companies across the continent to cut output.

The European Union´s statistics office, Eurostat, said the jobless rate across the entire 27-nation bloc is now 7.9 percent, up from 7.7 percent in January.

If the EU´s Lisbon Strategy from the year 2000 had actually been implemented properly, European countries today would have caught up with the United States economically, and European social systems would be successfully modernised. But this never happened. Research by the Max Planck Institue for the Study of Socities now shows that the non-binding decision- making and implementation processes of the European Union are responsible for the failure of European´s “Agenda 2010”.

Why has the Lisbon Strategy failed to fulfill the hopes so far? Some of the reasons could be such as complexity and faulty implementation i.e. methodological problems or such as fundamental substantive problems.

But, the Lisbon Strategy has delivered much less than had been hoped for or that is necessary for renewing the European economy. However, to my mind, considering the future of Lisbon Agenda, relaunching the strategy with almost maybe the same rethoric will not be able to solve the EU´s structural economic problems. The EU should understand that the reason for the failure of the strategy does not lie in the problems with implementation. In fact, EU has serious structural problems, inlcuding mentality – regarding the relative competetiveness against Asia and US.

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