Can Europe deliver growth? The Sapir Report and Beyond. CEPS Policy Brief No. 45, January 2004

Pelkman, Jacques and Casey, Jean-Pierre. (2004) Can Europe deliver growth? The Sapir Report and Beyond. CEPS Policy Brief No. 45, January 2004. [Policy Paper]

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Abstract

The SAPIR report (Sapir et al., 2003) is important for Europe. The justification of and search for higher economic growth in the EU ought to be on the very top of the EU agenda everywhere. Offering a very rich and useful survey of many issues related to European growth, or indeed the lack of it, the report’s analysis is insightful and should be compulsory reading for policy-makers and political leaders. Sapir et al.’s policy recommendations are numerous and rightly touch economic as well as institutional aspects at EU level. Its status is therefore that of an agenda-setter. Unfortunately, this has perhaps been insufficiently appreciated. The timing of publication (17 July 2003) and the lingering fascination with the final package of the Convention (Part III and some technical revisions were handed over to the Italian presidency on the 20th of July) lowered the probability of appropriate and widespread attention. Limited as the reporting was at the outset, the media appetite for conflict has caused a one-sided emphasis on the Pavlovian reactions of (two) Commissioners objecting to a few conclusions, related to only one (i.e. the EU budget) of six sets of recommendations, solely in order to protect their turf (agriculture and cohesion). Little if any serious exposition of the analysis and strategic direction of the report has been provided in the press. This neglect as well as the defensive reactions to just a few conclusions out of 33 recommendations are completely mistaken. Commission President Prodi was right in asking for this report from a group of well-known economists and a leading political scientist. Now that the report has finally begun to trickle down in EU policy circles, it may still accomplish what, in our view, is indispensable: to bring the growth debate back in Europe, established on a serious footing and based on solid analysis as well as policy options changing the status quo where necessary. The following discussion will not focus on the economic analysis – where we largely agree – or the analysis of ‘governance’ questions and design at EU level. This is not to say that the lengthy treatment of many issues in the report could not be subjected to further scrutiny, but this should best be done on other occasions. Our appreciation of the analysis in the Sapir report is that it can serve as well as any other, if not better, as the basis for a policy debate. Therefore, it is more fruitful, for present purposes, to concentrate on the assignment, the orientation and the policy recommendations of the report in the light of a preponderant question: How (much) does it help to revitalise Europe in securing a higher long-run growth path?

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