9 February 2004

Advancing long-term prosperity - economic reform in an enlarged Europe

At the Lisbon European Council, in March 2000, Europe’s leaders committed themselves to a ten-year programme of far-reaching economic reform designed to make the European Union “the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion.” This report examines progress towards this ambitious goal.

In February 2002, the Government published a White Paper, ‘Realising Europe’s Potential: Economic Reform in Europe’. The paper set out the Government’s vision of a dynamic, job-creating Europe, built on full employment, high living standards and social cohesion. It underlined the importance of structural reform in labour, product and capital markets for the realisation of this ambition. This report examines the progress that has been made in delivering European economic reform. It updates HM Treasury’s February 2003 review Meeting the Challenge: Economic Reform in Europe.

Since the launch of the Lisbon strategy, the European Union has made important progress in reforming its economy; the past year bearing witness to further substantial reform. But as Europe approaches the halfway point in the Lisbon timetable, the need for further action remains as pressing as ever; the pace of reform needs to be accelerated if Europe is to meet the Lisbon challenge. Globalisation, advances in new technologies and the imminent enlargement of the European Union provide new opportunities for Europe to prosper and new challenges to overcome. This will require tough decisions; a hard look at whether the traditional approaches to economic policy-making in Europe still deliver results; and difficult choices about whether the areas in which the EU currently targets its spending are the right ones. The occasion of the forthcoming spring European Council in March 2004 provides an important opportunity for Europe to take further strides towards the Lisbon goals, through a comprehensive programme of reform designed to:

promote employment and skills, through concrete action to improve labour market flexibility in Europe;
strengthen competition and regulatory reform, to deliver greater efficiency in the Single Market and to minimise unintended burdens on business;
advance enterprise and innovation, to increase flexibility and deliver a dynamic knowledge-based economy;
achieve greater external trade liberalisation, multilateral and bilateral, as a driver of progress toward the Lisbon goals;and
meet the challenge of sustainable development, to ensure that economic and social progress is matched by progress on the environment.

The documents below are available in Adobe Acrobat Portable Document Format (PDF). If you do not have Adobe Acrobat installed on your computer you can download the software free of charge from the Adobe website. For alternative ways to read PDF documents and further information on website accessibility visit the HM Treasury accessibility page.

Advancing long-term prosperity - economic reform in an enlarged Europe

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