Growth and productivity are picking up in Europe – a sign, according to Commission Vice-President Günter Verheugen, that: "We are on the right track…Our strategy is working…Now we have to focus all our energies on implementation at every level," he said commenting on the report, which was adopted on 1 December 2006.
Nevertheless, average labour productivity in the EU is still around 30% lower than in the US, with new member states showing particularly low levels. However, a few of these countries are also showing very high productivity growth levels.
The report focuses on certain areas of key importance for driving Europe’s ability to compete with the rest of the world and to reach its Lisbon goals of boosting growth and employment, including:
- Further liberalising the energy sector, in which there is a significant benefits deficit due to lack of competition and a high degree of market segmentation;
- increasing support for innovation, especially by facilitating access to venture capital;
- encouraging the emergence of lead markets that have chances of succeeding in a globalised economy;
- improving the business environment by:
- cutting red tape: A 25% reduction of administrative burdens for businesses could boost average EU GDP by 1.5%, with particular gains to be had in heavily-regulated countries such as Hungary and Slovakia;
- making it easier to start a business – as it seems that a positive correlation exists between per capita GDP and the ease to start up a business. The target is for all member states to make it possible for entrepreneurs to open a business within 7 days by 2007, and;
- focusing R&D investment on high-growth industries where the EU remains strongly competitive, such as chemicals, pharmaceuticals, ICT, machinery and transport equipment, and moving away from areas where it has a serious competitive disadvantage compared with the rest of the world – such as wood, textiles, office machinery and communication equipment.
