Archive for the ‘Digital’ Category

Ten year strategy must be blueprint for change

Sunday, January 10th, 2010

In his first major initiative since taking up his new role on January 1 2010, European Council president Herman Van Rompuy has convened a summit for February 11 to prepare for the 2020 Strategy, a ten year programme for creating a more competitive Europe. But can these plans really achieve anything? Only if they lay the groundwork for far-reaching change and adaptation.

It was of course the 2000 Lisbon Agenda which set out the first Ten Year Plan for the economic regeneration of the European Union. Who can forget the famous hostage to fortune, that Europe should become the world’s most competitive and dynamic knowledge-based economy by 2010?

The Lisbon Agenda was a creature of its time. The millennium dot-com boom was still booming, the digital revolution was expected to transform society. There was much talk of a new paradigm. Just as soaring stock markets ignored traditional industries in favour of the new, so the Lisbon Agenda envisaged old industries giving way to a new economy of high-tech research-based business creating employment and opening unbounded opportunities for the people.

It was not to be. The collapse of the dot-com dream was a disastrous start for Lisbon. The anticipated growth in output and jobs from the “new economy” proved an illusion. The industries which were expected to deliver a new world foundered in mountains of debt and disillusionment. No surprise then that all those early hopes were dashed.

Yet by the start of 2008 Europe’s economy had picked up. Enlargement had given a great boost and there were signs that governments were bringing more flexibility to their economies, for instance on tax policy and entrepreneurship, where the Lisbon process encouraged many member states to facilitate the creation and expansion of small firms.

Employment participation had gone up from 62.2 per cent of the potential workforce to 65.9 per cent, not yet to the 70 per cent Lisbon target, but certainly an improvement. The growth rate was improving, at 3.2 per cent in 2006 and 2.9 per cent in 2007 – compared with the 3 per cent Lisbon aim.

EU policy-making had made progress too, opening up sectors like telecoms and financial services. The new technologies had become deeply entrenched in traditional industries.

Then came the banking crisis. Collapsing output and rising unemployment have been the consequence and it is clear that the Lisbon targets have been hopelessly missed. Growth slumped to 0.8 per cent in 2008. Economic prospects for 2010 and 2011 look pretty gloomy.

So can Ten Year Plans really achieve anything? I see that Spanish prime minister José Luis Rodriguez Zapatero believes the Lisbon Agenda to be too soft. He wants the adoption of new policies which are binding on the member states, with power for the European Commission to penalise countries which fail to apply them.

This is tough talk, which would be linked with a formalised European economic policy, maybe beginning within the Euro Group. President Sarkozy is a keen supporter of this approach. Angela Merkel is definitely not. It contrasts with the soft policy philosophy of Lisbon which relied on peer pressure, search for best practice and an emphasis on opening up markets and stimulating research.

There is no doubting the challenge which Europe faces as it emerges from the recession. It strikes me that the biggest priority for a 2020 Strategy is to spell out the need for change and identify the hard choices for achieving it. Wealth creation must be the absolute priority. Europe’s industries face huge competitive pressures from countries like China and India at the same time that public spending faces increasing demands from an ageing population.  It won’t be easy to find common ground. A good test for Mr Van Rompuy indeed!

Posted in Competition, Digital, European politics, Eurozone, Finance, Telecoms | No Comments »

Shock: British journalist praises Barnier

Tuesday, December 8th, 2009

At last a touch of balance in Britain’s Daily Telegraph over the nomination of Michel Barnier to the internal market portfolio, with responsibility for financial services! I guess it’s no coincidence that the writer, eurosceptic Ambrose Evans-Pritchard, was the newspaper’s correspondent in Brussels from 1999 until 2004 – the same time span as Barnier’s former term as commissioner. No doubt he has personal experience of the Frenchman’s qualities.

I mention this in the context of the furore over recent months concerning EU appointments, linked in the UK with the debate over financial services regulatory reform and the perceived threats to the City of London. Maybe the frenetic atmosphere is beginning to disperse.

It certainly didn’t help when President Sarkozy told Le Monde that the English were “the big losers in this business”, although the wave of aggression whipped up in sections of the British press over Van Rompuy, Ashton and the Commission nominees was quite a provocation, to say nothing of prime minister Brown’s own trumpeting of the Ashton appointment as a national victory in response to Conservative criticism.

It’s just as well that Sarkozy’s plan for a reassuring joint visit to London with Barnier was knocked on the head. It really would have looked like a French conspiracy.

Barnier has been calming things down. His job, he says, is to strengthen Europe’s financial centres, including London. The fears which had been expressed in the City of London were “very exaggerated”.

There has however been a shift in the political mood which is reflected in the composition of the new Commission.  The three key economic portfolios – internal market, competition and industry – go to the Club Med with commissioners from France, Spain and Italy. Free markets, raw in tooth and claw, will not be the flavour of the next five years. The drive is clearly for more regulation, especially in financial services, regulation which has to operate at a European level. That’s no surprise, given that the near-collapse of the global banking system did have Anglo-Saxon origins.

An economic double-dip with more lost jobs would put further pressure on EU policy-makers.  The challenge for the Barroso II Commission is to maintain progress in the single market, to stimulate business activity, so helping drag Europe out of recession, and to continue the liberalisation of sectors like energy and telecoms. The nominated energy commissioner, Günter Oettinger, may have the most challenging role, given the problems which German firms have with the gas and electricity packages. Neelie Kroes, on the other hand, should be in her element with the “digital agenda”.

As for financial services, the Council of Ministers and the Parliament are of course working on proposals for financial regulation which also date from the outgoing Commission – the legacy of Charlie McCreevy. These include the establishment of the European Systemic Risk Board managed by the ECB and the three European supervisory bodies for banking, insurance and investment services.

There is some progress on these dossiers. It seems that ministers last week agreed that the powers of the three supervisory bodies will be circumscribed, allowing appeal to the Council by a member state which believes its sovereignty is being infringed. MEPs have yet to discuss these proposals.

Meanwhile the treatment of hedge funds and private equity remains a highly contentious issue which may run well into next year – perhaps beyond a British general election, which some rumours suggest could be in March 2010.

Posted in Digital, Elections, Energy, European politics, Finance, Treaty of Lisbon, UK politics | No Comments »

How MEPs use the internet: where is the dialogue?

Tuesday, May 19th, 2009

How to communicate better with the people of Europe? That’s one of the great challenges faced by all European institutions. It’s especially crucial for those who represent us in the European Parliament. When those 785 newly elected members take their seats on July 14, how will they relate to those they represent? Through speeches? press releases? newsletters? public meetings? How many will use the internet?

Fleishman-Hillard has taken the temperature in the outgoing parliament. It has just completed research  to see how the present crop of MEPs regard the internet and the amazing new possibilities which it opens up for political dialogue. FH suggests that members may be underestimating the effectiveness of the web for reaching out to voters.

The survey (to which 110 members responded) shows that the vast majority of MEPs do use the web extensively in seeking out information, both for keeping up to date with events through media outlets and for researching policy issues. Many of them use websites, blogs and newsletters to set out their views and keep their constituents informed about current developments. But all still see television and newspapers as the key media for getting their messages across.

It’s the dialogue which seems to be missing. The internet opens up vast possibilities for interactive communication, yet only 17 per cent of respondents saw digital media such as websites, podcasts or blogs as being “very effective” as communications tools. For half the MEPs personal engagement was the key and for 34 per cent it was TV and newspapers. Six out of 10 respondents had never heard of Twitter or did not intend to use it.

Of course we are talking about new phenomena. Facebook, YouTube, MySpace and Twitter did not exist at the time of the last European elections, and as the FH survey says, it is perhaps surprising that even 17 per cent recognised the potential of these outlets.

There is no question that these digital media can be immensely powerful tools, but in many different ways. When Gordon Brown uses YouTube to announce a policy initiative he is trying to reach the mass media, not to communicate with a selected group of chosen “friends”. By contrast we have Barack Obama’s internet campaign, which provided “personal” messages from Barack to the cell phones, Blackberries and computers of millions of his supporters. It was a telling factor in informing, mobilising and inspiring them to maximise the vote.

There is a generation issue too. Moldova is said to have had a Twitter Revolution, when demonstrations were organised via tweets among university students. Many campaign organisers are now well versed in the use of the internet to build support and co-ordinate action. I well recall a campaign to protect baby seals in the 1980s, when thousands of protest postcards flooded the Commission’s Berlaymont post room. Today that would all be done through the internet.

Technology will evolve during the five-year life of the new European Parliament, opening up new possibilities for interactive communication via the internet. I’m thinking for example of a new generation of television sets which will be directly linked with the web. I believe the impact of this could be profound. Watching TV is a social activity as compared with the solitary state of computer use and could turn internet communication into a much more responsive forum for the new generation of European parliamentarians. That MEP video diary could take on a whole new identity if the whole family can watch.

Posted in Digital, Elections, European politics, blogging, twitter | No Comments »