Competitiveness (COMP)

In an increasingly globalised world, one of the most important challenges of the European Union is to strengthen competitiveness. The objective is to overcome the current financial and economic crisis in Europe by increasing the competitiveness of the Member States. That is why the EU recently adopted the Europe 2020 strategy for smart, sustainable and inclusive growth. A key element of this strategy is sustainable growth performance and competitiveness, as it relates to the transition to a knowledge-based, green economy.

The Competitiveness Council deals with the internal market, industry, research and space policy, working out plans to strengthen competitiveness in the global context and growth in Europe. The Council meets at least four times a year. The competent ministers examine all the over-arching and sector-specific competitiveness issues, as well as all common political initiatives having an impact on companies, consumers and EU citizens. Issues addressed can cover such areas as the free movement of goods and services, measures to encourage enterprise in Europe or EU support for research.

Internal market

The internal market is the cornerstone of European integration. The Competitiveness Council covers a range of diverse issues in this field, such as public procurement, the freedom to provide services, consumer law, intellectual and industrial property rights, competition and company law. The Hungarian Presidency aims to promote the development of the area allowing the free movement of goods, people, services and capital, and to contribute to overcoming the remaining barriers. In this overall context Hungary, as a country with sound service export potential, acknowledges the prime importance of implementing the Services Directive.

Industrial policy

The European industrial policy backs up the efforts made by Member States to create a strong, dynamic industrial base in areas where action at Member State level is not effective. EU-level decisions essentially aim to ensure the conditions necessary to adapt more quickly to structural changes. It is also important for EU policies  to promote better exploitation of the industrial potential of policies in the fields of innovation, research and technological development. The competitiveness of small and medium-sized enterprises (SMEs) and their development is especially important. Through their innovative, dynamic and adaptive qualities they represent one of the key drivers for economic growth and increasing employment.

Research and innovation

The EU pursues a common research and innovation policy. The Seventh Framework Programme with its budget of EUR 53 billion is the Union's main instrument for funding research in Europe, and contributes to the creation of a European Research Area (ERA). The latter is to promote the mobility of researchers, technology and knowledge and lead to improved coordination of European, national and regional research policy. In addition to this, it would also enable the launching of European-level initiatives.

All these policies should be harmonised with the new socioeconomic strategy of the EU for the next ten years. The Europe 2020 strategy was adopted at the European Council held in June 2010 to provide a response to the economic crisis and to set forth objectives that, if met, would allow the EU to become a knowledge-based, sustainable and inclusive economy delivering high levels of employment, productivity and social cohesion. At European level, seven flagship initiatives were launched in order to achieve these objectives.

PRIORITIES OF THE HUNGARIAN PRESIDENCY

European Semester

The key element of the Europe 2020 strategy will be the introduction of the European Semester, which will begin along with the Hungarian Presidency in January 2011. Its mission is to harmonise the Stability and Growth Pact with the Europe 2020 strategy.  Member States will be required to present an annual programme of reforms based on integrated guidelines proposed by the Commission and adopted by the Council, which will be evaluated together with the stability and convergence programmes that are to be submitted in the framework of the Stability and Growth Pact. This would eliminate the chances of implementing reforms aimed at achieving the objectives of the strategy to the detriment of budgetary balance.

The agenda of the Competitiveness Council during the Hungarian Presidency will be defined by the dual priorities of contribution to the Europe 2020 strategy and the enhancement of the Single Market. One of the greatest challenges of the Hungarian Presidency will be the implementation in practice of the European Semester, which aims to strengthen the ex-ante character of the economic policy coordination within the EU. The Competitiveness Council will also play a role in assessing and discussing the details of the first flagship programmes and in beginning their implementation.

Single Market Act

In the environment of globalisation and economic crisis it is not possible to strengthen the confidence between Member States and between market actors without a developed and efficient EU internal market. The Hungarian Presidency will therefore give priority support to all initiatives that aim to clear away any obstacles to the four freedoms and which aim to put the internal market into the service of citizens and enterprises. Hungary will attach particular emphasis to the Single Market Act that was put up for consultation in October 2010. The Presidency attaches great significance to obtaining an agreement on the Single Market Act and to having the measures set forth therein be given priority during the Council discussions.

Evaluating the implementation of the Services Directive

The Hungarian Presidency attaches great importance to concluding successfully the mutual evaluation process aimed at studying the implementation by Member States of the Directive on Services in the Internal Market, which aims to assist the free movement of services by prescribing the abolition of discrimination on the basis of citizenship or place of establishment. It cannot be emphasised enough how important it is to increase the competitiveness and mobility of enterprises, especially small and medium enterprises, so as to give them a place in keeping with their importance in the Europe 2020 strategy. The Competitiveness Council can also contribute to this by making it easier for SMEs to  cooperate across borders.

European Private Company

The Hungarian Presidency will pay increased attention to the negotiations on the proposal for a statute on a European Private Company. In order to improve access to the market and financial funds for SMEs and to simplify the regulatory environment, Hungary will give special attention to the mid-term review of the Small Business Act.

It is an indispensable requirement for a deeper understanding of the functioning of the Single Market to provide citizens and consumers with continuous information on how they can exercise their rights in practice. The Framework Directive on Consumer Rights figures prominently on the agenda of the Competitiveness Council. In addition to the appropriate adoption and implementation of internal market legislation, the assistance given with a view to the practical application of regulations will be an indispensable element for strengthening confidence in integration and the internal market. The Hungarian Presidency will pay special attention to reinforcing administrative cooperation between authorities, such as the further development of the Internal Market Information System or the linking of company registers.

Innovation ability and sustainable industrial base

The innovation ability of enterprises is one of the cornerstones of European competitiveness. It is important that the business environment and financial opportunities support enterprises, including SMEs, in the use of methods that provide incentives for innovation and produce innovative products. What is needed is innovation not administration. To this end, the Hungarian Presidency will strive to harmonise the Small Business Act and the Innovation Union flagship objectives mentioned in the Europe 2020 strategy.

The need for structural changes in the industry in response to globalisation and the economic crisis poses new challenges for Europe’s industry. Improving the business and economic conditions of businesses, including SMEs, has become essential, as  has providing smart regulations and an EU-wide high quality infrastructure and network services, and establishing a strong and sustainable industrial base that is also globally competitive. The Hungarian Presidency wishes to contribute to having the Council set the tangible priorities of industrial policy as soon as possible and to committing to them. The reform of the European standardisation system under preparation, the main directions of which will be first reviewed by the Council during the Hungarian Presidency, will give an impetus to both the internal market of products and services and industrial production.

The priority topic on the agenda of the research section of the Competitiveness Council will be the debate on the interim assessment of the Seventh Framework Programme. The results of this assessment are of primary importance for the planning and preparation of the Eighth Framework Programme. The Hungarian Presidency pays close attention to harmonising the Framework Programmes and EU and national resources that are allocated to other research and development, as well to the simplification of rules of participation.