HUNGARIAN PRESIDENCY OF THE COUNCIL OF THE EUROPEAN UNION

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Europe 2020 Strategy

Europe has realized that it must overcome a number of challenges if it wishes to remain competitive with the rest of the developed and developing world. The Lisbon Strategy, announced at the threshold of the 21st century, expired in 2010, as the worst financial and economic crisis of the past decades raged on the continent. The European Union set the goal of alleviation of damages and recovery. This is why Member States adopted a new European competition and development strategy in a very short time. In developing the Europe 2020 Strategy, questions of management, coordination and implementation of the strategy were given special attention, which the Member States linked tightly with one of the key issues in economic governance, namely the European Semester. The rotating Hungarian Presidency of the Council pays special attention to making sure that the European Semester,  a key instrument of the macro-economic surveillance to be applied for the first time under this Presidency, runs smoothly.

 

BACKGROUND

The ten-year Lisbon Strategy aiming at the development of European Union competitiveness came to an end in 2010. Just at the time of the global financial and economic crisis, when the steps taken by the EU and the Member States were determined by alleviating damages and accelerating recovery. This was the reason why the Member States adopted the new Strategy at the earliest possible time, at the 17 June, 2010 meeting of the European Council.

The Europe 2020 Strategy applicable in the current decade assessed the weaknesses of the previous strategy and identified three priorities (smart, sustainable and inclusive growth), and also sets five headline targets as new elements:

Implementation of these targets at European level is made possible by national targets set out in the National Reform Programmes that Member States had to prepare by 12 November, 2010. (Hungary met this deadline.)

The EU has assigned three instruments to reach these goals: the existing EU instruments as well as seven new flagship initiatives also help to reach the goals:

  1. “Innovation Union” to improve financing of research and innovation;
  2. “Youth on the Move” to enhance the performance of education systems;
  3.  “A digital agenda for Europe” to reap the benefits of a digital single market;
  4. “Resource efficient Europe” for sustainable economic growth;
  5.  “An industrial policy for the globalisation era”  to improve the business environment, especially for SMEs;
  6. “An agenda for new skills and jobs” to modernise labour markets;
  7. “European platform against poverty” to ensure social and territorial cohesion.

The issue of control and governance of the EU 2020 Strategy is key to its success. This latter one is based on three separate elements:

  • macro-economic surveillance assuring solid macro-economic environment;
  • monitoring reforms promoting growth, focusing on structural reforms – their outcomes will be monitored through the highlighted and national targets;
  • budgetary supervision through the Stability and Growth Pact.

 

THE SIX MONTHS OF THE HUNGARIAN PRESIDENCY

The so called European Semester will assure the coordinated and efficient use of the available instruments, which will start for the first time in March, 2011. Within these frameworks, the Council will make an inventory of the general macro-economic situation and on the progress made along the five targets, and then the Spring Meeting of the European Council will give horizontal guidelines. Member States will consider them and they can prepare their stability and growth programmes simultaneously and submit them and their reform programmes to the European Commission in April every year.

OBJECTIVES

Launching the Europe 2020 Strategy and the related European Semester will be an especially important task for the Hungarian Presidency. Council debates must take place while sticking to the very tight schedule so the Member States can make responsible decisions for the sake of smart, sustainable and fast growth. The Hungarian Presidency will especially aim at forming synergies in the cooperation between the Council formations and the work of the European Council headed by the permanent President.