EU could do better on economy, says OECD

The Organisation for Economic Co-operation and Development (OECD) presents a compelling snapshot of the EU as an increasingly confident and accomplished bloc in a survey released today (20 September).

But, it warns, in its first ever survey of the EU, that policymakers must use the current economic upswing as a launch-pad for further reform if the bloc is to progress, or even sustain its current position, in the longer term.

The survey sets out a host of targets. On the competition front, it urges the EU to continue taking a tough line with protectionist countries.

Nodding to yesterday’s (19 September) EU proposals to wrench open energy markets, it says that more competition is needed in network industries. The potential gains from reform in sectors such as telecoms and postal services is estimated at 1.5-2% of gross domestic product.

On labour market reform, it says that member states must open their doors to workers from other EU countries. Making it easier to transfer pension rights across borders and harmonising qualification standards would help.

Consumers could help drive internal market reform if equipped with quick and effective remedies, it advises.

Future economic success at global level will largely depend on whether slow-coach member states manage to catch up with their speedier counterparts. Despite boasting some of the world’s top performers among its ranks - France and Germany for their companies and the UK for its labour markets - the general performance of the EU is being dragged down by the laggards.

The EU average on many indicators is often mediocre, says the report, noting that Europe’s economic performance has been trailing behind the world’s best performers for decades. In relative terms, the older 15 EU member states are no closer to US income levels than they were 30 years ago. Still, major achievements such as the creation of the single currency and the single market for goods have been chalked up despite the challenges of recent years, says the report. Recent roadblocks are a public backlash against integration, rising protectionism, painful public service reform and the indigestion caused by the recent addition of 12 new members to the bloc.

The Organisation for Economic Co-operation and Development (OECD) presents a compelling snapshot of the EU as an increasingly confident and accomplished bloc in a survey released today (20 September).