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Last month Commission President José Manuel Barroso said he was supporting the ambitious economic goals being proposed by the Austrian presidency to improve economic development. These include specific targets for jobs and growth, investment in innovation or research as well as higher use of renewable energy sources. It is being suggested that overall the EU should create six million new jobs in the three-year period 2005-2007, helping to reduce unemployment from a peak of nine per cent at the end of 2004 to one per cent in 2007. But how feasible is this plan?
One hopes that it does reach this ideal state as revealed by studies geared to use knowledge workers – be it through science, skills or people - as the key to innovate and enhance levels of competitiveness possibly by forging a social pact. Yet in spite of this noble cause there was no agreement reached last year to sign such social pact. In their opinion employers lament that it is indeed unfortunate that after lengthy discussions with all stakeholders to reach a social pact, the unions backed out of the agreement.
On the other hand, a solution by the European Union was first mooted by the Commission in 2000. This christened the Lisbon Agenda and its scope was to achieve a better working environment which can create better affluence, more sustainable jobs and social cohesion. The Strategy represented an innovative approach to development because economic objectives were not juxtaposed with social ones. Instead, the Strategy endeavoured to demonstrate that economic and social objectives are intertwined and the implementation of the economic objectives might feed-back support and strength to the social objectives, and vice versa.
It is crucial for us to emulate the strategy formulated at the Lisbon Summit on achieving a higher jobs growth by investing in Knowledge workers thereby boosting our potential for sustainable employment opportunities.
Such Knowledge workers would be the building blocks of new cyber projects such as SmartCity.
The Lisbon (as revised) initiative seeks to mobilise investment in areas that will reinforce on-going structural reforms, stimulate growth and create jobs. The Agenda was improved and made more flexible to accommodate difficulties faced by member states during the first five years. In its priority document for 2005-2010, the Barroso commission explicitly revisits and tones down the various objectives of the Lisbon agenda. According to some sources in the Commission there have been serious internal debates in the new Commission with regard to making it more doable. Following such a revised Agenda, Malta recently submitted a roadmap for the next three years which was examined and approved by the Ecofin Council .This report covers the three years to 2008 and its main aim is to reduce the national deficit to match the Maastricht criteria. In a few words this involves correcting the excess deficit registered in the past years. It comes as no surprise that we have to labour hard to trim our excessive budget deficit which peaked 10.3 % in 2003 and to reduce it to 2,7% this year .Our projections show that the deficit in 2008 will not exceed 1.2 percent. As a consequence of our belt tightening one hopes that the national gross debt will plummet from its present high to reach 67.3 percent in 2008. What makes interesting reading is the recent report engaged by the Commission called a wide-ranging Euro barometer Special Survey. This covers a number of attention-grabbing trends within the 25 EU Member States. It‘s primary scope is to analyse all the factors concerning the deteriorating employment situation in Europe. The underlying factor appears to show that countries are suffering from inadequate demand and risks of underlying inflation. It is widely agreed that the main factor which is now being addressed by the revised Lisbon Agenda is the deep seated rigidities in labour laws combined with lack of competitiveness. Reading through this survey one notes that in five Member States, the overall perception of the employment situation is positive. Such countries comprise; Ireland, Denmark, the United Kingdom, Luxembourg and Cyprus.
Conversely the perceptions in Poland, Slovakia, Portugal, Germany, Greece, Malta and France are negative. Another crucial indicator is the index of environment awareness. Typically the survey reveals that respondents reported a downbeat reply in Hungary (81% of negative replies), Portugal (79%), Malta and Slovakia (75%).Such a weak rating for Malta can be the result of respondent apathy and an awareness that a lot needs to be invested to solve our environmental problems. But public enemy number one in most countries is that of not achieving employment targets.
Achieving jobs growth depends on the ability to maintain and develop the competitiveness of manufacturing industry and in particular the services sector. Industry’s interdependence with services cannot be ignored and the progressive outsourcing of business services has reduced the apparent scale of manufacturing industry. On a local aspect, it is encouraging to note that the submission of Malta ‘s National Reform Plan this was given the green light by the European Commission .The national reform programme (NRP), forms an integral part of the Lisbon Strategy. It addresses priority areas such as the sustainability of public finances, employment, education and environment and is meant to foster a unilateral front between Government, the social partners and civil society.
But will this be lambasted as another wish list? Realistically speaking, the solution to our lack lustre economic growth depends on a number of external factors such as the rate of expansion of neighbouring European countries that are our main export clients. A further problem is the low participation rate of the female workforce. In this respect the N.A.P. proposes measures intended to boost the female employment rate by seven per cent, and reduce the early school leavers' rate by 13 per cent within 2010.
Quite an ambitious task but then it all looks very hunk dory on paper but surely if more inward investment is attracted now as full members then the targets are achievable. Another important actor is whether MTA manages to re-brand the island as an upmarket tourist resort.
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