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.
Posts Tagged ‘ competitiveness pact ’
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.