If the EU is to move forward it needs to look beyond the internal market
Writing exclusively for Endeavour Public Affairs, Bendt Bendtsen MEP sets out what policies and changes the EU and their member states need to put in place in order to move their economies forward. At the heart of his proposals is making the EU the leader in developing a knowledge-based green economy. Bendt Bendtsen, is a former leader of the Danish Conservative Party and former Minister for Trade and Industry within the Danish Government.
Europe is currently facing great challenges. Not only do we need to tackle severe public debts in most of the European countries we are also facing record high unemployment and loss of competitiveness. In addition, we are still deeply dependent on energy from outside the EU – especially oil and gas. In order to overcome these challenges it is absolutely critical that we accept the fact that they are all interlinked. That is why we need to adopt policies that are able to address all the challenges.
First, we need to restore and reorganise the Eurozone’s economies. “Simply” put we need to bring down public debt, and encourage sustainable growth in the private sector. For too many years most European countries have spent more money than their public finances allow. A range of different austerity policies has been and should be adopted both at the EU level and in the member states. As a step in the right direction I welcome The Fiscal Compact adopted in March 2012. But ultimately this is not a job for the EU – it is absolutely crucial that the member states take action on their own. Most of the European countries have not had the will nor the wish to make the necessary political reforms, but we need to take a hard look at ourselves in order to get out of this crisis.
Second, we need to improve competitiveness. Although austerity measures can help restore the stability of the public finances and regain the confidence in the Euro, austerity can not stand alone. To stimulate growth, we need to reallocate money spent on expensive welfare to research, better education and innovation. Europe’s future survival depends on our ability to add value to our products and services. We cannot and shall not compete with China, India, Pakistan, Vietnam, Mexico and others on the price of labour. One way to improve European competitiveness is to expand and develop the EU internal market. Since the introduction of the internal market we have come a long way in breaking down barriers for the movement of goods and services within the EU. But there is still a lot of work to be done. Difficulties in accessing markets, difficulties with getting finance and unnecessary administrative burdens are still major issues for SME’s and entrepreneurs.
Beyond the internal market, we need the political ambitions and visions to identify sectors which will increase European competitiveness on the long term. One solution is to create a greener and more intelligent economy based on the entire spectrum of renewable energy resources. There is a huge potential for economic growth and job creation in renewable energy. But if we want the full potential it is absolutely critical that we adopt the right instruments and legislation now. I am pleased that renewables are currently generating great political attention and I hope that Europe in the near future will be a world leading continent in providing energy efficient services.
If the European Union would lead, compete and develop as a knowledge-based green economy then we will not only have a better stand in the globalized world but also be able to create the jobs that the European labour markets are desperately hungering for. This transition would not only make Europe less dependent on energy from outside the EU and thus provide cheaper energy for European industry and consumers, we would also provide European industry with an upper hand in production methods and ways of thinking, when resource scarcity really hits home globally and dependency becomes a security issue.