EUROPE 2020 : HOW TO SUCCEED WHERE LISBON FAILED?

The EU has taken a battering in the last few months. After being sidelined during UN climate talks in Copenhagen, EU policy makers entered the new year at the mercy of bond markets, which rounded on Greece's debt problems, and have since turned their attention to Spain and Portugal. The earthquake in Haiti brought even more negative press and accusations of a lack of unity on aid pledges.

At their summit called by European Council President Herman Van Rompuy for 11 February, EU leaders took stock of the situation while holding their first debate on the EU's next ten-year economic plan, dubbed Europe 2020'. A successor to the Lisbon strategy, the plan has two aims: one, to get Europe out of the crisis, and two, to pick up where Lisbon left off: to make the EU "the most dynamic and competitive knowledge-based economy in the world".

They will have to succeed where Lisbon failed. Just eight member states met the plan's 70% employment target by the 2010 deadline, and only two managed to dedicate more than 3% of GDP to research and development. Peer pressure and naming and shaming were the only tools at the Commission's and Council's disposal to pull up errant countries and encourage them to get on with the reforms, so it is little surprise, then, that in 2008 the employment rate was 66% - close to the target, but not quite there - and R&D spending was at a paltry 1.9% of GDP.

However, the crisis put paid to even meagre triumphs. With an unemployment rate of 10% and rising, and growth tumbling by over 4% across the bloc last year, some member states are struggling for survival. Greece, Portugal and Spain are not the only victims. The International Monetary Fund (with the Commission's help) has had to intervene to shore up Romania, Latvia and Hungary. Ireland was a major worry until last December's deficit-slashing budget calmed markets. Twenty countries have gone over the EU's 3% of GDP budget deficit limit and government debt is ballooning.

Van Rompuy is now trying to take control of the new strategy, giving leaders more of a say on how it is run. But member states were in charge before, to little effect. Ann Mettler of the economic think tank The Lisbon Council says, "The Council hasn't figured out how to overcome resistance about what it says it wants". Member states are reluctant to give the EU executive a more hands-on role. A cursory glance at national submissions to the Commission's November consultation bears this out. The UK suggests...