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EU leaders seek to ignite economic growth
www.chinaview.cn 2005-03-23 02:52:34

    BRUSSELS, March 22 (Xinhuanet) - European Union (EU) leaders on Tuesday kicked off a two-day summit to find ways to ignite Europe's underperforming economy.

    The meeting, attended by the heads of state and government of the EU's 25 members, will seek to re-start the EU's faltering Lisbon Agenda, a high-profile program launched in 2000 to enhance the bloc's competitiveness.

    It is also expected to adopt proposed changes to rules underpinning the euro, so-called Stability and Growth Pact. The summit comes against a backdrop of sluggish growth across Europe. Earlier this month, the European Central Bank (ECB) cut its growth forecast for the euro-zone to 1.6 percent, reflecting the stumbling economic performance of France and Germany in particular.

    The EU has had to row back from ambitious targets set out in Lisbon summit in 2000, when it set a goal of 3 percent annual growth in an effort to bridge the economic gap with the United States.

    Speaking ahead of the summit, the EU executive European Commission President Jose Manuel Barroso said he was looking for a"clear signal" from the summit that EU nations were focused on creating jobs and boosting growth.

    "The European Union is ready for a fresh start, ready to express its enormous potential," Barroso said.

    "We are getting serious about finally delivering growth and jobs."

    EU leaders are likely to agree to national economic action plans as well as approve increased investment in research and development and the reform of state aid plans.

    The EU leaders will also give green light on Sunday's agreementby EU finance ministers to rewrite the Stability and Growth Pact, which underpins the single European currency used by 12 countries.Leading EU nations had seen the pact - which limits the size of a country's budget deficit to 3 percent of GDP (gross domestic product) - as restricting their ability to carry out major economic reforms.

    The ECB has however expressed concern that the changes could undermine confidence in European public finances.

    Analysts warnd that the summit is likely to see fierce disagreement over plans to liberalize the EU's services sector. Current proposals - which are opposed by France and Germany - would make it possible for professionals to work without restrictions in all 25 member states.

    Critics believe the plans - drawn up by the former internal market commissioner Frits Bolkestein - would result in companies shifting staff to cheaper bases in Eastern Europe, undercutting large EU economies.

    There are also concerns that workers from Eastern European countries will flood into the west, exacerbating the already high unemployment levels in Germany.

    France has called for the directive to be rewritten to exclude public services and to include specific guarantees on wages and health and environmental standards.

    The European Commission, however, is resisting pressure for thedirective to be withdrawn. Enditem

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