The EU Commission has outlined a new long-term plan for economic revival which puts the focus on deregulation and business-friendly policies.
The plan, while urging EU governments to accelerate reforms to their labour markets and to cut red tape, ditches the EU's long-stated ambition of forging the 'world's most dynamic economy' by 2010.
'If we can re-dynamise Europe's performance, we can help guarantee a sustainable and lasting transformation of our continent,' European Commission president Jose Manuel Barroso told leaders of the EU parliament.
The report marks the mid-way review of the EU's five-year-old 'Lisbon Strategy' of reform, launched amid much fanfare in the Portuguese capital with the goal of overtaking the US in the competitiveness stakes.
The new-look Lisbon Strategy will be presented to EU leaders at a March summit where, diplomats believe, it will win strong approval.
The 2010 target is no longer mentioned in the report, giving formal recognition to the widespread view that owing to years of economic slowdown and the slow pace of reform, the EU is nowhere near ready to meet the goal.
The reports recommendations include:
- Pensions and healthcare systems must be modernised to cope with the ageing societies.
- Billions more euro should be pumped into research and development. Europe should create its own elite academy along the lines of the world-famous Massachusetts Institute of Technology.
- Business must be freed from onerous regulation.
- The EU's internal market should be completed with long overdue deregulation of the telecommunications, energy and transport sectors.
- Government aid for companies should be channelled into start-ups rather than national champions to support the R&D goal.
- The EU should appoint an economic reform overseer - dubbed 'Mr or Ms Lisbon'.
