The Annual European Growth and Jobs Monitor shows that Finland is best placed to withstand the credit crunch, while Ireland has recorded an unprecedented fall of nine places to thirteenth in an Allianz/Lisbon Council study of the fourteen largest economies in Europe.
"Given the dramatic decline in performance over the past 12 months, the EU-15 will not be able to reach the Lisbon targets in 2009 nor presumably in 2010, with the current overall score of 0.84 – compared to 1.12 at the end of 2007," according to a statement released ahead of the report's official launch.
The annual competitiveness survey measures economic growth, productivity growth, jobs, human capital, future-oriented investment and sustainable public finances.
Declines in growth rate and labour productivity will be followed by deteriorations in employment and public finances, the report says, though Europe's human capital continues to improve.
Even if the global economic crisis had not struck, only six European countries – Finland, Greece, Netherlands, Poland, Spain and Sweden – were on track to fulfil their Lisbon targets by 2010.
The Lisbon Strategy sought to make Europe "the world's most competitive, dynamic knowledge-based economy" by next year.
Michael Heise, chief economist of Allianz SE and principal author of the study, said the bright spots for Europe are its good human capital, cutting-edge technical prowess, a strong social model and comparatively good governance.
"Now, commodity prices are low, monetary policy is at an unprecedentedly lax level and economic stimuli are on the way. These factors should combine to restore some growth later this year. This makes us relatively optimistic in the medium to long term."
Paul Hofheinz, president of the Lisbon Council, added that job creation recorded between 2005 and 2008 has provided a cushion to soften the impact of the sharp decline seen in recent months. He said the Lisbon Strategy has helped Europe focus on innovation and growth. "It is time to proclaim this strategy a success," he said.
Ranking in Europe's Growth and Jobs Monitor:
- Finland
- Poland
- Netherlands
- Greece
- Sweden
- Spain
- United Kingdom
- Belgium
- Germany
- Austria
- Denmark
- France
- Ireland
- Italy
