European Union Competitiveness Policy

The Competitiveness Council meets four to ten times a year, depending on the urgency of the dossiers to be dealt with (internal market, tourism, industry and research). The council is formed by national ministers responsible for the different sectors concerned.


The growing technological gap that separates Europe from its American and Japanese competitors means that a great deal of work must be done to promote research and development, since these areas are vital to the international competitiveness of EU enterprises. With the Maastricht Treaty (1992), the Community set itself the objective of reinforcing the scientific and technological bases of European industry.

In January 2000, the Commission launched its strategy for implementing the European Research Area (ERA), the essential aims of which are to eliminate obstacles created by national borders, promote the specific use of research findings and ensure easier access to venture capital. Along the same lines, the Lisbon European Council (March 2000) established priorities in this area, including the protection of inventions by creating a Community patent, the networking of national and joint research programmes, improving the mobility of researchers in Europe, and measures to support business start-ups.

The Commission proposed an allocation of EUR 17.5 billion for the Sixth Framework Programme (2002-2006). During this period, scientific research should concentrate on the following thematic priorities:

life sciences, genomics and biotechnology for health;
information society technologies;
nanotechnologies and nanosciences, knowledge-based multifunctional materials and new production processes and devices;
aeronautics and space;
food quality and safety;
sustainable development, global change and ecosystems;
citizens and governance in a knowledge-based society.

Other important areas involve improved networking of national research programmes in Member States, the mapping of scientific and technological excellence in Europe, and innovation.

Internal market

The internal market is the principal achievement of European integration. Article 14 of the EC Treaty states that “the internal market is an area without internal borders in which the free movement of goods, persons, services and capital is ensured”.

As scheduled, the internal market, an area without internal borders for goods and services, was completed on 31 December 1992. As far as the free movement of persons is concerned, the internal market had not been completed by 1 January 1993. The Treaty of Amsterdam enabled progress to be made in this area, since it incorporates the Schengen acquis. The United Kingdom and Ireland do not cooperate in this area. Denmark, meanwhile, reserved the option to decide (within six months) whether it would participate in each new extension of the Schengen acquis.

In November 1999, the Commission submitted its strategy for developing the internal market up to 2005. This involves improving citizens’ quality of life, enhancing the efficiency of EU capital and product markets, and improving entrepreneurship in the European Union. The Helsinki European Council (December 1999) adopted this strategy.

Industrial policy

The principles underlying European industrial policy were approved in 1990. They rest on four pillars which the Commission still uses when this policy has to be converted into specific action:

1) promotion of intangible investment;
2) development of industrial cooperation;
3) organisation of fair competition;
4) modernisation of the authorities’ industrial policy.

Promoting intangible (or immaterial) investment involves efforts to develop knowledge, human potential and the quality of products and services, and to encourage innovation in a bid to increase our acceptance of market development and the adaptation of organisations and structures. In this respect, the labour force’s skills and capacity to adapt, the efficiency of the venture capital market, a climate fostering business start-ups, innovation and appropriate legal and physical infrastructures are deemed essential.

The Commission’s task is to promote cooperation among businesses in the Member States, particularly small and medium-sized enterprises. As early as 1999, it exposed the relative lack of alliances among European businesses in terms of cutting-edge technologies, and the inadequacy of capital investment in this sector’s initiatives.

Organising fair competition should produce results in the Member States, in the Union as a whole and worldwide. Making maximum use of WTO and OECD facilities then becomes essential. Fair competition on the world market for iron and steel, for instance, is crucial to the survival of European enterprises. It is likewise important to pursue our cooperation with (groups of) third countries in Central and Western Europe or in the Mediterranean Basin countries.

Modernising the authorities’ role focuses on old administrative and management practices that no longer correspond to current economic developments. The authorities should be able to work more efficiently to create a more favourable industrial climate and foster the development of healthcare, education and communication sectors, among others. Enterprises themselves should also react more flexibly and more rapidly to change. Both the public and private sectors are suffering from the aftermath of a lengthy period of protectionism, during which they were hardly forced to react dynamically to signs from the market.

Working Party on Competitiveness and Growth

The Working Party on Competitiveness and Growth deals with issues such as the single market, industry policy, better regulation and competitiveness in the EU. The group is responsible for questions relating to the single market, business and industrial issues, better regulation and overall growth strategy for the EU. The group is divided into three subgroups: Single Market, industry and better regulation. The composition of these subgroups varies according to the agenda.

More details about Working Party on Competitiveness and Growth

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