Download EUROPEAN COMMISSION PUBLIC CONSULTATION ON THE

EUROPEAN COMMISSION
PUBLIC CONSULTATION ON THE EUROPE 2020 STRATEGY
Name: Giuseppe Astarita
Contact details:
Address: Federchimica Via G. da Procida 11 20149 Milano Italy
Phone number: +39 02 34565357
E-mail: [email protected]
Country of residence: Italy
Language of your contribution: English
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A) Background for the public consultation:
The Europe 2020 strategy was launched in March 2010 as the EU's strategy for promoting
smart, sustainable and inclusive growth. It aims to achieve a knowledge-based, competitive
European economy while preserving the EU's social market economy model and improving
resource efficiency. It was thus conceived as a partnership between the EU and its Member
States driven by the promotion of growth and jobs.
The Europe 2020 strategy is built around five headline targets in the areas of employment,
research and development, climate and energy1, education and the fight against poverty and
social exclusion. The strategy also set out a series of action programmes, called "flagship
initiatives", in seven fields considered to be key drivers for growth, namely innovation, the
digital economy, employment and youth, industrial policy, poverty and resource efficiency.
The objectives of the strategy are also supported by action at EU level in areas such as the
single market, the EU budget and the EU external agenda.
The Europe 2020 strategy is implemented and monitored in the context of the European
Semester, the yearly cycle of coordination of economic and budgetary policies at EU level.
The European Semester involves discussion among EU institutions on broad priorities,
annual commitments by the Member States and country-specific recommendations prepared
by the Commission and endorsed at the highest level by leaders in the European Council.
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In January 2014 the Commission launched a framework for energy and climate policies up to 2030. A
reduction in greenhouse gas emissions by 40% below the 1990 level, an EU-wide binding target for
renewable energy of at least 27% and renewed ambitions for energy efficiency policies are among the
main objectives of the new framework.
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These recommendations should then be taken on board in the Member States' policies and
budgets. As such, together with the EU budget, the country-specific recommendations are
key instruments for the implementation of the Europe 2020 strategy.
After four years, the Commission has proposed, and the European Council of 20-21 March
2014 has agreed, to initiate a review of the Europe 2020 strategy. On 5 March 2014, the
Commission adopted a Communication "Taking stock of the Europe 2020 strategy for smart,
sustainable and inclusive growth" (Communication and Annexes ). drawing preliminary
lessons on the first years of implementation of the strategy. Building on these first outcomes
and in a context of a gradual recovery of the European economies, it is time to reflect on the
design of the strategy for the coming years.
Through these questions, we are seeking your views on the lessons learned from the early
years of the Europe 2020 strategy and on the elements to be taken into account in its further
development, in order to build the post-crisis growth strategy of the EU.
B) Questions:
1) Taking stock: the Europe 2020 strategy over 2010-2014
Content and implementation

For you, what does the Europe 2020 strategy mean? What are the main elements that
you associate with the strategy?
If we are to take the Europe 2020 strategy at face value, and the Commission at its word,
then,
“Europe 2020 is the EU's growth strategy for the coming decade”.
José Manuel Barroso (President of the European Commission)
However, it does not set a clear growth target: and it does not set growth as a
priority. It talks of smart growth, sustainable growth and inclusive growth. The above
quotation from President Barroso continues,
“In a changing world, we want the EU to become a smart, sustainable and inclusive
economy. These three mutually reinforcing priorities should help the EU and the Member
States deliver high levels of employment, productivity and social cohesion”.
This passage serves to highlight the fact that the Europe 2020 priorities concern the
adjectives (smart, sustainable and inclusive) and not the noun (growth). There is, at
best, an assumption that this strategy will generate growth: and nothing to prevent
measures taken under this strategy from inhibiting or undermining growth.
The Europe 2020 strategy started as a rather theoretical plan for smart, sustainable and
inclusive growth which was intended to result in EU's economic growth, competitiveness,
while maintaining its social market economy model and improving its resource efficiency.
Net results obtained till now, especially in terms of EU GDP growth and other growthoriented goals do not meet the initial expectations and aims of the Strategy.
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
Overall, do you think that the Europe 2020 strategy has made a difference? Please
explain.
The short-term priority of stabilising the economy after the financial crisis has been
met, after some time and with a severe social impact, especially in the field of
employment. The long term priority of delivering real growth and competitiveness for
the EU economy has not been achieved.
Overall, Europe 2020 strategy has yet to make a real difference in terms of growth!
Furthermore, it is difficult to see as this difference can be made, until EU approach is
based on the artificial increase of energy and carbon price, “to generate the resources for
innovation and low carbon economy”. After the relative level of energy price has been
acknowledged as a problem for EU competitiveness, no authoritative Commission
member has dared to defend this principle explicitly, but nevertheless the strategy has
not been changed.
As we have already said, many of the current targets are not directed towards growth and
in some cases they are being addressed through measures that actually inhibit growth.
Thus the unilateral, unconditional 20:20:20 climate target, has led to costly inefficiencies
and policy overlaps. More to the point, it has resulted in measures that (i) guarantee a
high price for renewable energy (feed in tariffs) and (ii) measures such as the ETS that
are designed to increase the price of fossil energy until it is even higher. The end result
can only be high energy prices, which can only serve to inhibit industrial growth. Whether
these targets have actually led to a reduction in global carbon emissions is debatable: but
it is clear that economic growth will require policies that seek to achieve such reductions
through innovating down the cost of renewable energy rather than pushing up the price of
energy to support uncompetitive technologies.

Has the knowledge of what other EU countries are doing in Europe 2020 areas impacted
on the approach followed in your country? Please give examples.
The European policy has pushed strong incentivation of (electricity) renewable sources
(see Italy and Germany) with big cost increases, low attention to cost effectiveness and
uneven costs distribution among consumers (German industry essentially exempted,
Italian industry only partially exempted), with consequent distortion effects on intra-EU
competitiveness

Has there been sufficient involvement of stakeholders in the Europe 2020 strategy? Are
you involved in the Europe 2020 strategy? Would you like to be more involved? If yes,
how?
The involvement of stakeholders in the Europe 2020 strategy needs to be
substantially strengthened. Real economic growth will require substantial investment
by the private sector in wealth generating, job creating businesses. The views of
potential investors on how to make the EU a more attractive place in which to invest
should be a key determinant of the strategy. Therefore the views of industry
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stakeholders should be systematically taken into account, especially throughout the
procedures of the impact assessment analysis at the earliest possible stage.
Tools

Do the current targets for 2020 respond to the strategy's objectives of fostering growth
and jobs? [Targets: to have at least 75% of people aged 20-64 in employment; to invest
3% of GDP in research and development; to cut greenhouse gas emissions by at least
20%, increase the share of renewables to 20% and improve energy efficiency by 20%; to
reduce school drop-out rates to below 10% and increase the share of young people with
a third-level degree or diploma to at least 40%; to ensure at least 20 million fewer people
are at risk of poverty or social exclusion].
Targets are not tools. Moreover, the targets do not measure growth. At best, some of
these targets may be proxy measurements of economic growth. Others may be inimical
to growth. Thus:

Climate objectives that are to be met by measures that increase the overall cost of
energy will reduce aggregate output in the economy. For example, the ETS
constrains growth and gives perverse incentives to relocate manufacturing to outside
Europe.

Increasing the proportion of people aged 20-64 in employment from 68.4% (2013) to
75% would obviously require and result in more jobs: but that says nothing about the
way in which this might be done.

Equally, reducing the number of people exposed to poverty and social exclusion is a
desirable objective and may result from economic growth: but it does not, in and of
itself, produce economic growth.

Similarly, reducing school drop-out rates and increasing the share of young people
with a third level degree may be “good things”: but they do not in themselves create
jobs (other than in educational establishments). Without an increase the availability
of gainful employment the targets would result in better educated unemployment
queues.
These targets put the cart before the horse. They imply measures to increase
employment or reduce poverty as a means of generating growth – rather than focusing
on measures that lead to growth as a means of increasing employment and reducing
poverty.
Therefore, the selected targets do not directly respond to the strategy´s objectives
of fostering growth and jobs and they lack the dimension of competitiveness,
especially for the manufacturing base of Europe.

Among current targets, do you consider that some are more important than others?
Please explain.
Looking at current performance, those targets that are the best proxies for economic
growth and have a tangible social effect (increasing the proportion of the population in
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work and reducing social exclusion) are not being met. Also, the target of 3% of GDP in
research and development has not been met putting the innovation capacity of Europe in
question. In contrast, we are being more successful in increasing the number of people in
education and so reducing the number of people in employment or unemployed: and at
meeting climate change objectives. These latter are important, but meeting them in the
wrong way is likely to stifle rather than to promote growth and jobs.

Do you find it useful that EU-level targets are broken down into national targets? If so,
what is, in your view, the best way to set national targets? So far, have the national
targets been set appropriately/too ambitiously/not ambitiously enough?
We believe that EU targets should not be automatically translated in (binding)
national targets. Policies could be implemented that take in proper account
national specificities, and cost effectiveness.
Targets too often reflect political aspirations without having any regard to practical
feasibility. They are only as useful as the measures taken to achieve them. Insofar
as important areas of policy (industrial policy, and energy policy) remain national
competences the targets should be at national level and should take full account of the
national specificities and the general principle of subsidiarity of European Union Law.
However, if the purpose is to promote growth and jobs, the current targets are
inappropriate (regardless of the level of ambition). To promote growth an energy policy
should look to provide competitively priced energy not push up the price of energy to
reduce carbon emissions: to promote investment an industrial policy should look to
reduce policy costs and enhance speed to market.

What has been the added value of the seven action programmes for growth? Do you
have concrete examples of the impact of such programmes? ["Flagship initiatives":
"Digital agenda for Europe", "Innovation Union", "Youth on the move", "Resource efficient
Europe", "An industrial policy for the globalisation era", "Agenda for new skills and jobs",
"European platform against poverty"].
Among the seven action programmes for growth the two flagships namely “Innovation
Union” and the “An industrial policy for the globalization era” showed the potential
benefits that a strong research and industrial base in Europe can have in terms of
growth and job creation. This was demonstrated in practice by the fact that the
Members States with the more innovative and competitive industries had were better able
to cope with the financial crisis. Horizon 2020 (the financial instrument implementing the
Innovation Union) and Key Enabling Technologies (KETs) in these two flagships are
examples with high added value in terms of innovation and competitiveness capacity.
That having been said, the impact of some action programmes in the real World has
been well below expectations. Those with a chance of really promoting growth need to
engage the active participation of economic actors so they can be scaled up to the point
where they become economically significant.
2) Adapting the Europe 2020 strategy: the growth strategy for a post-crisis Europe
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Content and implementation

Does the EU need a comprehensive and overarching medium-term strategy for growth
and jobs for the coming years?
Since the Europe 2020 strategy is not fully delivering its initial targets, especially in terms
of job creation and employment, research and development expenditures and poverty
reduction, the EU definitely needs a renewed strategy for growth and jobs as soon
as possible.

What are the most important and relevant areas to be addressed in order to achieve
smart, sustainable and inclusive growth?
In order to achieve smart, sustainable and inclusive growth the most important and
relevant areas to be addressed are:
• The creation of a business friendly environment in Europe that reduces
bureaucracy and unnecessary regulation, minimizes costs, attracts new investments,
offers job positions, attracts highly skilled young people and promotes innovation.
• The existing innovation gap between EU and its main competitors and the obstacles
to the development of EU research into new marketable products and services.
• The lack of well-educated, high quality workforce with appropriate skills,
especially in the academic disciplines of science, technology, engineering, and
mathematics. Such skills remain a key challenge to speed up the delivery of solutions to
societal challenges and ensure its future competitiveness.
• The decline of the share of manufacturing in GDP which has fallen from 15.4 % to
15.1 % in 2013 and the deterioration of the EU’s productivity performance in comparison
to that of our competitors.
• The risk of investment leakage and “carbon” leakage in which manufacturing
activities are relocated outside Europe.
Overall, the ultimate target should be clear and straightforward: Growth. This
strategy should focus on the noun rather than the adjectives.

What new challenges should be taken into account in the future?
Europe is becoming a less productive economy – purchasing more and more of the
goods it consumes from third countries. This model has been sustained by consumer
borrowing against inflating asset (house) prices – that created in the past the illusion of
economic growth. This model is unsustainable. The real challenge now is to innovate,
to be competitive and create new wealth. Other emerging challenges which should be
taken into account are:
• Geopolitical changes
and regional
competitiveness and sustainable growth.
•
instabilities
affecting
European
Societal changes and migration side-effects.
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• Access to (renewable) raw materials and energy sources at affordable and
competitive prices.

How could the strategy best be linked to other EU policies?
The renewed EU2020 strategy should be the primary focus of EU policy and all other
EU policies should mainstream within this general framework.
Mainstreaming should involve the EU Institutions and the Member States, within the
framework of a new flexible structure: such that the European Semester in the Council,
the existing “Parliamentary weeks” and the “economic dialogues” in the European
Parliament, and the Commission’s Annual Growth Survey, are all geared to delivering on
this overarching policy objective.
A key element of this approach should be to ensure that all policy measures are delivered
at the lowest possible compliance costs. To achieve this, the strategy should adopt a
target of meeting agreed policy objectives while, at the same time, reducing compliance
costs by, say, 20%: and impact assessments should be geared to identifying measures
that meet this target.

What would improve stakeholder involvement in a post-crisis growth strategy for Europe?
What could be done to increase awareness, support and better implementation of this
strategy in your country?
Stakeholders should be encouraged to participate in consultation procedures
concerning both the preparation and the implementation stages of the post crisis
growth strategy, at the earliest possible stage. Stakeholders’ opinions should be taken
into account according to their size and their real effect to the economy and the society.
Tools

What type of instruments do you think would be more appropriate to use to achieve
smart, sustainable and inclusive growth?
Economically sustainable growth can only result from increased investment in wealth
generating activities. The private sector invests when it sees a reasonable prospect of a
return on that investment: and, therefore, policy instruments should be directed towards
increasing the likelihood of such a return. To do this they should focus on creating a
business friendly regulatory environment, reducing industry’s costs, and enabling the
innovation process while building public confidence in and acceptance of innovation.
Other instruments might be directed towards reducing the cost, and therefore the risk, of
an investment in the real economy: for example, innovative financial instruments and
incentives to increase the access to finance for enterprises and industry producing
goods and service.

What would best be done at EU level to ensure that the strategy delivers results? What
would best be done at Member State level?
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EU should have the responsibility for the planning, the coordination and the monitoring of
the EU2020 Strategy while Member States should have to implement and deliver results
at national level for the benefit of the society and the real economy.

How can the strategy encourage Member States to put a stronger policy focus on
growth?
Member states could be encouraged to put a stronger policy focus on growth by
systematically mainstreaming competitiveness concerns across all national policy
areas and through the entire legislation procedure, especially throughout the impact
assessment stage.

Are targets useful? Please explain.
Targets are no substitute for policies that deliver results. If a target is intended to
define the desired outcome then it should reflect the purpose (ie growth) and the policies
should be directed towards that end.
Economic growth in general and competitiveness in particular, will not result from
measures that increase rather than reduce costs. Any targets should therefore include a
stipulation that they should be achieved through measures that enhance competitiveness
and reduce cost.

Would you recommend adding or removing certain targets, or the targets in general?
Please explain.
As stated above the current targets, notably the targets for the reduction in greenhouse
gas emissions, renewable energy and energy efficiency are not directed towards
securing economic growth and achieving them will not deliver economic growth. Indeed,
the current measures to achieve these climate targets are inhibiting growth. To include
these targets in the “EU’s growth strategy” is a misnomer: and they should be removed.
Actually, as they encourage the shift from direct to indirect emissions, they at least have
a negative impact on industrial growth.
Instead there should be one single target of at least 4% real EU GDP growth should
be inserted. In order this target to be achieved, a new set of 20-20-20 “growth”
oriented indicators, namely:
1) 20% reduction of EU regulation costs, 2) 20%
increase of industrial investments and 3) 20% contribution of industry to EU GDP
should be also adopted.

What are the most fruitful areas for joint EU-Member State action? What would be the
added value?
Joint EU-Member State action should be taken especially at regional level for the
development of smart specialization strategies, the deployment of key enabling
technologies, the support of extroversion and the promotion of sustainable growth. A
combination of voluntary initiatives and policy frameworks should be explored further.
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3) Do you have any other comment or suggestion on the Europe 2020 strategy that
you would like to share?
Thank you for completing the questionnaire. Please send your contribution, along with any
other documents, to [email protected].
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