1. THE LISBON STRATEGY Re-launch or last rites? Iain Begg Visiting Professor, European Institute London School of Economics

2. LISBON FAULT-LINES Strategic aims and policy goals valid Strategic aims and policy goals valid –But shifting priorities undermine consistency Specific objectives more doubtful Specific objectives more doubtful –Few demonstrate case for Community level Policy instruments have been inadequate Policy instruments have been inadequate –Problems with incentives –Lack of budgetary means at Community level –Action plan fatigue? Target proliferation? OMC’s shortcomings OMC’s shortcomings

3. THE DELIVERY FAILINGS The underlying growth rate failure The underlying growth rate failure –Debilitating effect on all dimensions of reform Key targets being quietly shelved Key targets being quietly shelved –Little sign of advances in R&D or innovation –2010 employment rate target beyond reach by 2004 –Backsliding on Kyoto aims Large disparities among the Member States Large disparities among the Member States –Leaders: Nordics –Laggards: France, Germany &, especially, Italy

4. VARYING GEOMETRIES I Lisbon 2000 KNOWLEDGE-INTENSITY Competitiveness Social Cohesion JOBS Economic Reform 2010

5. VARYING GEOMETRIES II Gothenburg 2001 Competitiveness Social Cohesion Environment Sustainable Development LONG-TERM

6. VARYING GEOMETRIES III Re-launch 2005: curing the sick child GROWTH Social Cohesion Jobs Environment Economic & Governance Reforms DEADLINE?

7. KOK RECOMMENDATIONS Focus advocated on five aims: 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 All to be advanced by National Action Plans –…plus putting the delinquents in the dock

8. AND THE RE-LAUNCH? Another accurate diagnosis Another accurate diagnosis Another re-statement of the imperatives Another re-statement of the imperatives Another obligation to produce action plans Another obligation to produce action plans Another commitment to community action Another commitment to community action –…but scant means –…and even probability of budgetary curbs A fresh call for MSs to take ‘ownership’ A fresh call for MSs to take ‘ownership’ –…but no naming, blaming and shaming

9. TRAJECTORY OF ECONOMY The supply-side reform ‘j’-curve Time Performance Without major reforms With extensive Structural reforms

10. IS THERE A SOLUTION? Member States do know what’s needed Member States do know what’s needed Overcoming political inertia 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 Macroeconomic dimension cannot be ignored Review and clarify purpose of co-ordination Review and clarify purpose of co-ordination –In particular: is it genuinely adding value?

11. ‘The promotion of growth and employment in Europe is the next great European project.’ Kok report, November 2004

12. THE LISBON STRATEGY Re-launch or last rites? Iain Begg Visiting Professor, European Institute London School of Economics