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EUROPE 2020
Background
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The financial crisis has diminished the EU's growth potential, and
made it clear just how interdependent its members' economies are,
particularly inside the eurozone
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The most important priority now is to restore growth and create
effective mechanisms for regulating financial markets - in Europe
and internationally
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In strengthening its system of economic governance, Europe must
learn from previous shortcomings which have put the financial
stability of the whole eurozone at risk
EUROPE 2020
Background
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Europe has already taken important measures to protect jobs,
support demand, and help business to withstand the impact of the
crisis
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Getting the banking system working responsibly at the service of
the economy is the first prerequisite for boosting investment: we will
therefore complete our overhaul of financial markets regulation and
supervision
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Getting public finances back into shape will not be painless, but it
will stand us in good stead for the future
EUROPE 2020
...but we must also make our
economy stronger for the future…
There is no way out of the crisis without growth and our strategy
aims to achieve it by:
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freeing up Europe's growth potential by removing obstacles in the
internal market to increase mobility of people, services and
investments
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delivering on overdue structural reforms (rigid labour markets,
ineffective social protection system, lagging productivity levels, etc.)
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investing in key sectors that will create growth and jobs in the future
and will bring a decisive competitive advantage
EUROPE 2020
Europe 2020 - a Strategy for Growth
and Jobs
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Europe 2020 is the EU's growth strategy for the coming decade
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Its ultimate goal is to help the EU become a smart, sustainable and
inclusive economy
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The Union has set five ambitious objectives to be reached by 2020
in the areas of:
- employment
- innovation
- education
- social inclusion
- climate/energy
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Each Member State will adopt its own national targets in each one
of these areas
EUROPE 2020
Main Priorities
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Smart growth
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Sustainable growth
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Inclusive growth
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Exiting the crisis
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The 5 targets for the EU in 2020
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Employment
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R&D / innovation
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greenhouse gas emissions 20% lower than 1990
20% of energy from renewables
20% increase in energy efficiency
Education
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3% of the EU's GDP (public and private combined) to be invested in
R&D/innovation
Climate change / energy
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75% of the 20-64 year-olds to be employed
Reducing school drop-out rates below 10%
at least 40% of 30-34–year-olds completing third level education
Poverty / social exclusion
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at least 20 million fewer people in or at risk of poverty and social
exclusion
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Flagship Initiatives
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The areas most in need of attention will be addressed
by 7 flagship initiatives at EU, national, local and
regional level
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Within each initiative, both the EU and national
authorities will have to coordinate their efforts so they
can be mutually reinforcing
EUROPE 2020
The 7 Flagship Initiatives
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Digital Agenda for Europe
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Innovation Union
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Youth on the move
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Resource-efficient Europe
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An industrial policy for the globalisation era
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An agenda for new skills and jobs
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European platform against poverty
EUROPE 2020
Smart Growth
“Smart growth” means improving the EU's performance in:
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education
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research/innovation (creating new products/services that generate
growth and jobs and help address social challenges)
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digital society (using information and communication technologies)
EUROPE 2020
Targets for smart growth
EU targets for smart growth include:
1) combined investment levels to reach 3% of EU's GDP
2) 75% employment rate for women and men aged 20-64 by 2020
3) better educational attainment, meaning in particular:
– reducing school drop-out rates below 10%
– at least 40% of 30-34–year-olds with 3rd level education
EUROPE 2020
How will smart growth be achieved?
The EU intends to boost smart growth through three flagship
initiatives:
1) “Digital agenda for Europe”
- creating a single digital market based on fast / ultrafast internet and
interoperable
2) “Innovation Union”
- refocusing R&D and innovation policy on major challenges for our
society & strengthening every link in the innovation chain
3) “Youth on the move”
- helping students and trainees study abroad
- equipping young people better for the job market
- enhancing performance/international attractiveness of EU’s universities
& improving all levels of education and training
EUROPE 2020
Sustainable Growth
“Sustainable growth” means:
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building a competitive low-carbon economy that makes
efficient, sustainable use of resources
protecting the environment and preventing biodiversity loss
capitalising on Europe's leadership in developing new green
technologies and production methods
introducing efficient smart electricity grids
harnessing EU-scale networks to give our businesses an
additional competitive advantage
helping consumers make well-informed green choices
EUROPE 2020
Targets for sustainable growth
EU targets for sustainable growth include:
1) reducing greenhouse gas emissions by 20% compared to 1990
levels by 2020
2) increasing the share of renewables in final energy consumption to
20%
3) moving towards a 20% increase in energy efficiency
EUROPE 2020
How will sustainable growth be
achieved?
The EU will try to boost sustainable growth through two
flagship initiatives:
1) “Resource-efficient Europe”
- reducing CO2 emissions
- promoting greater energy security
- reducing the resource intensity of what we use and consume
2) “An industrial policy for the globalisation era”
- supporting entrepreneurship
- covering every part of the increasingly international value chain
EUROPE 2020
Inclusive Growth
“Inclusive growth” means:
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raising Europe’s employment rate, especially with regard to
women, young people and older workers
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helping people of all ages anticipate and manage change through
investment in skills & training
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modernising labour markets and welfare systems
ensuring the benefits of growth reach all parts of the EU
EUROPE 2020
Targets for inclusive growth
EU targets for inclusive growth include:
1) 75% employment rate for women and men aged 20-64 by 2020
2) better educational attainment, meaning in particular:
– reducing school drop-out rates below 10%
– at least 40% of 30-34–year-olds completing third level education
3) at least 20 million fewer people in or at risk of poverty and social
exclusion
EUROPE 2020
How will inclusive growth be
achieved?
The EU intends to boost inclusive growth through two flagship
initiatives:
1) “Agenda for new skills and jobs”
– helping people acquire new skills, adapt to a changing labour market
and make successful career shifts
– modernising labour markets
2) “European platform against poverty”
– ensuring economic, social and territorial cohesion
– guaranteeing respect for the fundamental rights of people experiencing
poverty and social exclusion
– helping people integrate in the communities where they live, get
training and help to find a job and have access to social benefits
EUROPE 2020
National Targets
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The 5 EU-level targets are being translated into national targets,
to reflect the level of ambition each Member State and the
contribution individual member countries are able to make to the
wider EU effort
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This will happen in a dialogue with the Commission in order to
check consistency with the EU headline targets
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Each country will then set its final national targets in its national
reform programme (NRP) later in 2010
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Member States may opt for a medium-term revision of their
respective targets later on
EUROPE 2020
National Reform Programmes
(NRPs)
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NRPs are the key delivery tool for the Europe 2020 Strategy at
national level
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NRPs should be multiannual (covering at least 3 years) and
should be updated and submitted annually along with Stability or
Convergence Programmes (SCPs)
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Their main purposes will be:
- to identify how Member States have translated EU headline
targets into national targets
- to set out how Member States aim to meet these targets, ex.
which measures will be implemented by when, by whom and
with which budgetary consequences
EUROPE 2020
Main elements of NRPs
The NRPs should include the following components:
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Macroeconomic scenario
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Macroeconomic surveillance
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Thematic coordination
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Participation, communication and identification of good
practice
EUROPE 2020
Implementation and Monitoring of
NRPs
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At EU level, monitoring of reforms will be carried out by the
Commission and the Council
the Commission in particular will issue an Annual Growth
Survey as part of the European Semester (beginning in
January 2011) which will take into account progress towards
the Europe 2020 targets
A transparent assessment and working framework will be
establish to track progress towards the EU-level headline
targets
A “scoreboard” will also be put in place illustrating progress
towards the Europe 2020 objectives on the basis of a set of preagreed indicators
EUROPE 2020
Country-specific recommendations
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In June of each year, the Commission will propose a single set of
country-specific recommendations and/or drafts opinions
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These will be attached a single country report and an overall
report for the euro zone and issued under separate legal
instruments:
- Council Opinions on fiscal policies
- Recommendations on other elements of macro-economic
surveillance
- Recommendations on thematic issues
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Failure to follow up the recommendations sufficiently may result
in the Commission issuing policy warnings and adopting
appropriate incentives and sanctions in the context of excessive
imbalances procedures
EUROPE 2020
Contents of the Annual
Growth Survey
The annual review will focus on:
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Fiscal and macroeconomic developments in the EU and the
Euro area
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Thematic developments in the EU, esp. overall progress
achieved on the EU headline targets, as well as progress on the
flagship initiatives
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Fiscal stance and overall progress towards fiscal targets
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Horizontal issues related to developments in intra-euro-area
imbalances and competitiveness
EUROPE 2020
Contents of the Annual
Growth Survey
The forward-looking part will describe:
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The main challenges for fiscal and macroeconomic
policies
Policies to address these challenges
Priorities for action in the area of structural reforms to
advance the thematic part of the strategy
The Commission’s draft Joint Employment Report will
constitute a part of the survey addressing employment
policies
EUROPE 2020
Governance of the Europe 2020
Strategy
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Economic policy coordination under the Stability and Growth
Pact and Europe 2020 should be aligned closely in the
framework of the European Semester, an integrated economic
surveillance structure which aims to provide more timely policy
advice to Member States
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Governance of the Europe 2020 Strategy will be based on 3
integrated strands:
- Macroeconomic surveillance
- Thematic coordination
- Fiscal surveillance under the Stability and Growth Pact
EUROPE 2020
Macro-economic surveillance
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Main goal: ensuring a stable macroeconomic
environment conducive to growth and employment
creation
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It will cover macroeconomic and structural policies
with a view to addressing:
- macroeconomic imbalances
- macrofinancial vulnerabilities
- competitiveness issues with a macroeconomic
dimension
EUROPE 2020
Thematic coordination
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Monitoring of growth-enhancing reforms
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Focus on structural reforms in the following fields:
- innovation and R&D
- resource-efficiency
- business environment
- employment
- education
- social inclusion
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Focus on removing obstacles to achieving the objectives set in the
Integrated Guidelines
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Progress to be monitored through the five Europe 2020 headline
targets as well as the national targets that underpin them
EUROPE 2020
Fiscal surveillance under the
Stability and Growth Pact (SGP)
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Fiscal surveillance will be enhanced to strengthen fiscal
consolidation and foster sustainable public finances
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This will help ensure the overall consistency of EU
policy advice by identifying the fiscal constraints within
which Member States’ actions are to be developed
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Member States have direct responsibility for the policy
initiatives to be undertaken under the Europe 2020
Strategy
EUROPE 2020
Addressing the crisis
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Euro-area finance ministers agreed on the establishment of the future
European Stability Mechanism (ESM) as of mid-2013. This will involve a
change to the TEU (Lisbon) Treaty
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The ESM will safeguard financial stability in the Euro area and will build on
the existing temporary European Financial Stability Facility (EFSF), which is
due to expire in 2013, and also complement the new framework for reinforced
economic surveillance in the EU
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This stability mechanism will assist Euro area Member States in financial
distress in combination with a strict economic and fiscal adjustment
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The new framework, which includes in particular a stronger focus on debt
sustainability and more effective enforcement measures, focuses on
prevention and will substantially reduce the likelihood of a crisis emerging in
the future
EUROPE 2020
Financial Supervision Reform
The supervision of the European financial system will be
strengthened by the creation of a number of bodies:
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European Systemic Risk Board (ESRB)
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European Banking Authority (EBA)
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European Insurance and Occupational Pensions Authority
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European Securities and Market Authority
EUROPE 2020