Dr. Bahadır KALEAĞASI - TÜSİAD International Coordinator
The European Union entered 2010 leaving behind a turbulent year of economic crisis and of a new institutional reform, and found itself in the middle of a macroeconomic instability crisis within the Eurozone, triggered by the economic situation in Greece. The EU is constantly changing in deepening its institutional powers and enlarging its geography. The global challenges necessitate the continuity of this change.
Lisbon, or Lisbon?
The aim of the first Lisbon was the economy. The aim of the second one is constitutional reform. The first is EU’s strategy to be the world’s most competitive knowledge-based economy. The second is the last treaty to render EU’s institutional structure more effective. It is a new constitutional arrangement without being a constitution.
The time that elapsed between the year 2000 when the Lisbon Strategy was adopted and the year 2010 demonstrated that economic goals could not be reached solely on the back of EU summit decisions. Undoubtedly, it is difficult to implement EU-wide policies without institutions that function effectively. Amidst the enlarging global economic background, the European project must deepen in at least three dimensions. On Turkey’s part, these three dimensions determine additionally the axes of country’s national interest as a future EU member:
1. A well-functioning EU internal market: goods, people, services, technology and money should have full mobility between EU countries without the inference of national borders. Moreover, this market should be supported by policies such as social rights, competition, consumer rights and information society.
2. Common policies on cross-border issues: transportation infrastructure, telecom, climate, energy… Biological, digital and financial viruses…
3. Alliance in international competition: World Trade Organization, China, USA, illegal immigration, security…
Balance Sheet and Action
EU has certainly made very important achievements in a number of fields in the 2000-2010 period. For instance, in the last 10 years, the EU has caught up with North America on the global internet map and even left it behind in broadband penetration. The EU has become a leader in mobile technologies; the telecom market and financial services have been liberalized and the health insurance system has been updated to cope with changing conditions.
The amount of financial resources allocated to R&D for scientific and technological innovation has increased, but has not yet been able to rise above 2% of GDP. The target had been set, however, at 3% in order to compete globally with the US and Japan. Furthermore, China and India that were not even on the radar in 2000 are rapidly rising in the field of R&D. Since resources within the EU are distributed among different countries, there exists a problem with carrying over their total effects to the EU level.
On the other hand, the “European social model” continues to be the most advanced system in the world despite the fact that it is in a crisis, relatively speaking. The flexicurity approach that was developed in Denmark is now embraced throughout the EU. This concept seeks to protect the employee in work life as opposed to the job itself if it becomes unproductive. As a result of global competition, some jobs may lose their economic raison d’être. Bankruptcy, liquidation, contraction or transfer of production to other countries might become inevitable. In these cases, the attempt to protect the job, the company or the sector might lead to more social destruction in the middle term. Instead, a flexible approach that aims to protect the employee, to support people by providing opportunities for life-long learning, entrepreneurship, new employment, as well as education for their children, healthcare and housing is being developed. More jobs, less unemployment, wider participation of women in the labor force, more youth employment, more technology, a more secure pension system… These are very important items in the political agenda in all developed or rapidly developing countries.
The EU is also looking to make new leaps and accelerated transformations on a number of other fronts:
- Now a Vice-President of the European Commission is exclusively responsible for the Digital Agenda. This agenda comprises intertwined areas such as information and communication technologies, telecommunications and the information society. It is a fundamental political arena and will have to become a field of a leading “ministry” at the EU level.
- Another new political responsibility area is Climate Action. We are in the years leading up to a greener economy, green energy and green energy technologies. The EU deems itself the pioneer of this evolution. The Western consumption society as we have known in the last half century is rapidly changing.
- Entrepreneurship has long been the central theme of the EU private sector. BUSINESSEUROPE, to which TUSIAD and TISK are members from Turkey, has been pressuring EU institutions on this subject. The EU private sector demands more stability in the financial setting, in credit markets and tax policies, as well as support from small enterprises and priority to young and creative entrepreneurship.
The European Union is thus embarking on a new, decade long journey with its 2020 Strategy. This is a global and European action plan with clearly defined resources, implementation schedule, and targets that are measurable at national and local levels.
The EU 2020 Strategy is also an important negotiation framework for Turkey. It is a profile for domestic politics and global competitiveness. Turkey has to adapt its domestic agenda to the scope of this EU 2020 Strategy which has to become also the general framework within which Turkey’s EU membership process ought to be evaluated and implemented. Henceforth, the essential question is how to better integrate Turkey to Europe’s strategy for smarter, more sustainable and comprehensive growth. How to make sure that Turkey becomes a greater added-value contributing to a politically and economically more competitive EU on the World scene? This is a common challenge and a matter of mutual interest and historical responsibility for both the EU’s and Turkey’s decision-makers, opinion leaders, business, civic society, think-tanks and the media.
The world will certainly have changed tremendously without waiting for the target date of 2020. Neither the EU nor Turkey have to wait for a decade to gaze upon the balance sheet of progress.
"TÜSİAD Article Series"comprised of articles on current debates. The articles are prepared by TÜSİAD researchers. Opinions expressed belong solely to the author and do not represent the views of TÜSİAD.