As recently as July of this year, EU leaders took a fresh look at the Lisbon process and shifted the focus to the creation of growth and jobs. This objective is to be achieved with a package of measures. Our Trend Report “Lisbon II – Opportunities for Europe” of 11 May 2005 examined the key aspects. In order to assess the implementation progress we developed our Lisbon Indicator. We have now taken this further and broken it down to the national level for the four big euro area economies – Germany, France, Italy and Spain.
Lisbon process: how are the big EMU countries faring?
This creates both a more transparent basis for country comparisons as well as a means to asses the national action programs due to be published in the fall.
Main conclusions: without question Germany’s performance to date has been unsatisfactory, but recent reforms suggest that Germany can get nearer to the Lisbon targets. France looks set to move gradually towards the targets. The picture in Italy is gloomier. Policymakers are failing to tackle structural problems and the country appears doomed to continue to bring up the rear. Spain faces considerable obstacles going forward. Although relatively well-placed in terms of target fulfillment, these are likely to prevent the Lisbon curve from turning up.
The euro and the single monetary policy expose structural deficits more cruelly. This alone should provide an incentive to implement promising reforms. But “benchmarking” and “peer pressure” have failed to drive ahead the Lisbon process to date. It is to be hoped that the national action programs do at least serve to enhance transparency. Our country indicators also provide a sounder basis for assessment and comparison. It will be interesting to see how the strengths and weaknesses we have identified match up with the projects contained in the national action programs.
Dr Ingrid Angermann
Claudia Broyer
Jutta Kayser-Tilosen
Wolfgang Leim
Christiane Seyffart