Wednesday, September 15, 2004

Lisbonization, what Lisbonization?

The new Commission President-designate, as our readers will recall, has come in on the Lisbonization platform. Well, he was not exactly elected by anyone except the leaders of the member states, but that would have been his platform, had he stood for election.

Lisbonization has nothing to do with the fact that Barroso is the former Prime Minister of Portugal. He does not want to turn the whole of the EU into a vast Portugal. That would not be feasible, since it is not clear who would be providing the funds to support all these countries on the level Portugal is supported.

We are talking about the process that is intended to turn the EU into the most dynamic, forward looking, economy in the world.

Señhor Barroso has had some bad news. Eurostat has reported today that labour costs have risen within the European Union again in the last year. They have gone up by 2.2 per cent in the eurozone and by 2.8 per cent in the EU as a whole. This is rather an unusual disposition. Normally, whatever happens in the EU happens that much more in the eurozone.

The reason is one that was predicted at the time of enlargement: the biggest rises took place in the new member states. Costs fell in Austria by 0.5 per cent but rose everywhere else. The smallest hourly costs were recorded in Germany (1.2%) and the Netherlands (2.1%). In the UK costs have gone up by 4.3%, no doubt as a result of the Chancellor’s “prudent” and “business-friendly” policies. The highest rises were recorded in Latvia (10.4%), Hungary (8.4%), Estonia (5.8%) and Poland (5.3%).

Oh the joys of belonging to the (potentially) most dynamic economy in the world.

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