The Europe 20:20 Strategy [print sheet]
Last updated: 15/03/10

The Europe 20:20 strategy is a plan for economic renewal which will be implemented in June 2010, replacing the Lisbon strategy (2000-10). The Europe 20:20 strategy aims to guide Europe's economy out of the economic recession (which began in 2008) and to enable a high quality of life whilst preserving Europe's Social Model, raising employment, productivity and social cohesion.

The Lisbon strategy was decided at the European Council in Lisbon in March 2000 by all the European Heads of Government. The strategy was a development plan which set out a bold vision of creating 'the most competitive and dynamic knowledge-based economy' in the world and to push forward the creation of the single market between 2000 and 2010. It promised to create more and better jobs and to improve European society.

The original Lisbon strategy had several key aims. It set out to create an information society that would be based on strong research and development skills. It also called for fundamental reform of the economies of member states. In particular, it aimed to deregulate the single market for services, a sector in which about 70% of Europeans are employed. It also said that the European Social Model needed to be modernised and it set the goal of 70% employment across the EU. Although there was a great deal of support for the ideas behind the Lisbon strategy, in subsequent years, an economic downturn in many parts of the EU meant politicians did not follow the timetable set down at Lisbon. As a result, the EU launched an enquiry by former Dutch Prime Minster Wim Kok into why the Lisbon strategy was not more successful. The report, released in 2004, blamed EU states for not doing enough to bring about difficult changes. The Kok Report reduced the ambition of the strategy's targets. Every three years members had to report on the progress they had made, but the Lisbon strategy was not legally binding, so it was difficult for the EU to make members change. Another blow was delivered to the Lisbon strategy in 2005 when the European Council rejected the Services Directive which would have made competition easier in the service sector. A less ambitious version of the Directive was later adopted in 2006 and came into force in EU states in December 2009.

Following calls for the Lisbon strategy to be updated, a European Council meeting in March 2010 announced that the Europe 20:20 strategy would replace the Lisbon strategy. EU Leaders will discuss the new strategy further before it is launched in June 2010 and then in EU states will submit 'national reform programmes' on how they will meet the strategy's targets.

The Europe 20:20 strategy focuses on knowledge and innovation. Its 3 main aims are: growth from knowledge (with more investment in Research and Development (R&D)), creating an inclusive society (via a more flexible job market to reduce youth unemployment) and building a greener economy (including increased investment in green technologies).

The 20:20 targets include: raising EU employment rate (from 69% to 75%), reducing the number of Europeans living below national poverty lines by 25%, reducing greenhouse gas emissions by 20% compared to 1990 levels (or by 30% if the conditions are right), increasing renewable energy use to 20% of total energy consumption and increasing energy efficiency by 20%.

The 20:20 Strategy will force EU member states to present annual economic plans to the EU, but they will still not face sanctions if they do not meet the strategy's targets.

• EU productivity for every hour worked is very similar to that in the USA. However, total economic growth in the eurozone was only 1.6% in 2005, compared with 3.6% in the USA.

For

• The EU 20:20 strategy is important to improve economic growth in the EU and complete the single market - both aims central to the original European project.
• European productivity needs a boost to get ahead of competitors like the USA.

Against

• The new 20:20 strategy does not have sufficient power to force change to happen.
• The EU 20:20 strategy treats all EU countries' economies as the same regardless of how they now operate.
• By promoting free market reforms, the EU 20:20 strategy challenges the EU's traditional social model.

'The Lisbon Strategy was not successful due to weak governance structure and lack of accountability of the member states. This should not happen again' - Joseph Daul MEP, leader of the European People's Party (EPP), 2007-

'The Commission's proposals are not green enough and not strong enough on jobs and social policy and overall too lukewarm' - Stephen Hughes MEP, Party of European Socialist Group vice-president for economic and social affairs in the EU Parliament