European Economy Going South
February 5, 2004
The European Union is striving to become the world's most competitive and dynamic economy by 2010; however, according to EU officials, there is a growing gap between Europe and the United States. An annual survey of the 15 EU member nations found most governments do not have the political will to make needed economic and labor reforms.
The survey also found:
- The average unemployment rate for the European Union as a whole is 8.1 percent.
- The EU's labor productivity growth rate is between 0.5 and one percent, compared to the U.S. growth rate of two percent.
- Europe's per capita output is about 72 percent of that of the United States.
France, Germany and Italy have been especially reluctant to implement structural changes in their economies, while Austria, Luxembourg, Denmark, the Netherlands and Sweden have made the most progress.
The survey also faults lack of research, development and innovation in information and communication technologies, as well as lack of leadership among EU states. The EU's budget deficit also worsened last year, as France and Germany ran deficits of over 3 percent of their gross domestic product.
Paul Hofheinz of the Lisbon Council in Brussels, says, "Everyone knows what needs to be done. But unless Europe acts now, there won't be much of an economy left to reform."
Source: Robert Wielaard, "EU Says Europe Falling Behind on Economy," Seattle Post-Intelligencer, January 21, 2004.
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