European Student Think Tank

After a few rounds of policy pro­pos­als to bol­ster EU com­pet­it­ive­ness, eurozone-leaders have adop­ted the van-Rompuy/Barroso paper entitled “Pact for the Euro”. Though it does little to boost com­pet­it­ive­ness, it might be a use­ful addi­tion to the European Semester which aims at cre­at­ing a more coher­ent fiscal policy in the Union.

A month after the heav­ily cri­ti­cised Franco-German pro­posal of an com­pet­it­ive­ness pact for the EU, a num­ber of new ini­ti­at­ives have been tabled ahead of the EU sum­mit on March 23. The pres­id­ents of the European Com­mis­sion and the European Coun­cil, José Manuel Bar­roso and Her­man van Rompuy, as well as the Party of European Social­ists (PES) and the Alli­ance of Lib­er­als and Demo­crats for Europe (ALDE) pro­pose new ways to improve the EU’s com­pet­it­ive­ness. Moreover, former Com­mis­sion pres­id­ent Jacques Delors and the European Cent­ral Bank (ECB) have joined the debate. How­ever, no pro­posal offers a solu­tion on how to resolve the under­ly­ing reas­ons of the EU’s dimin­ish­ing com­pet­it­ive­ness, namely struc­tural defi­cits in many mem­ber state economies.

The sum­mit of the European Coun­cil in Brus­sels last week did not bring about any novel approaches relat­ing to the cre­ation of the internal energy mar­ket of the com­munity. How­ever, it saw Ger­many and France use the occa­sion to present their pro­posal for a “com­pet­it­ive­ness pact” for the EU. The pact sug­gests fuller har­mon­isa­tion of labour, tax and social policies and a con­sti­tu­tional curb on pub­lic bor­row­ing to enforce bal­anced budgets. Though rejec­ted by many mem­ber states, core ele­ments of the pro­posal are neces­sary and inev­it­able in the future. How­ever, it remains doubt­ful if they will help increase the Union’s competitiveness.