EUROPEAN COMMISSION

E U R O P E 2 0 2 0

A European strategy for smart, sustainable and inclusive growth



 


Preface 

 

2010 must mark a new beginning. I want Europe to emerge stronger 
from the economic and financial crisis. 

 

Economic realities are moving faster than political realities, as we have 
seen with the global impact of the financial crisis. We need to accept that 
the increased economic interdependence demands also a more 
determined and coherent response at the political level. 

 

The last two years have left millions unemployed. It has brought a 
burden of debt that will last for many years. It has brought new pressures 
on our social cohesion. It has also exposed some fundamental truths 
about the challenges that the European economy faces. And in the 
meantime, the global economy is moving forward. How Europe responds 
will determine our future. 

 

The crisis is a wake-up call, the moment where we recognise that 
"business as usual" would consign us to a gradual decline, to the second 
rank of the new global order. This is Europe's moment of truth. It is the 
time to be bold and ambitious. 

 

Our short-term priority is a successful exit from the crisis. It will be tough 
for some time yet but we will get there. Significant progress has been 
made on dealing with bad banks, correcting the financial markets and 
recognising the need for strong policy coordination in the eurozone. 

 

To achieve a sustainable future, we must already look beyond the short 
term. Europe needs to get back on track. Then it must stay on track. That 
is the purpose of Europe 2020. It's about more jobs and better lives. It 
shows how Europe has the capability to deliver smart, sustainable and 
inclusive growth, to find the path to create new jobs and to offer a sense 
of direction to our societies. 

 

European leaders have a common analysis on the lessons to be drawn 
from the crisis. We also share a common sense of urgency on the 
challenges ahead. Now we jointly need to make it happen. Europe has 
many strengths. We have a talented workforce, we have a powerful 
technological and industrial base. We have an internal market and a 
single currency that have successfully helped us resist the worst. We 
have a tried and tested social market economy. We must have 
confidence in our ability to set an ambitious agenda for ourselves and 
then gear our efforts to delivering it. 


 

The Commission is proposing five measurable EU targets for 2020 that 
will steer the process and be translated into national targets: for 
employment; for research and innovation; for climate change and 
energy; for education; and for combating poverty. They represent the 
direction we should take and will mean we can measure our success. 

 

They are ambitious, but attainable. They are backed up by concrete 
proposals to make sure they are delivered. The flagship initiatives set out 
in this paper show how the EU can make a decisive contribution. We 
have powerful tools to hand in the shape of new economic governance, 
supported by the internal market, our budget, our trade and external 
economic policy and the disciplines and support of economic and 
monetary union. 

 

The condition for success is a real ownership by European leaders and 
institutions. Our new agenda requires a coordinated European response, 
including with social partners and civil society. If we act together, then we 
can fight back and come out of the crisis stronger. We have the new 
tools and the new ambition. Now we need to make it happen. 

 

 

 

 

Josι Manuel BARROSO 


 



EUROPEAN COMMISSION 

Brussels, 3.3.2010 

COM(2010) 2020 


COMMUNICATION FROM THE COMMISSION 

EUROPE 2020 
A strategy for smart, sustainable and inclusive growth 


TABLE OF CONTENTS 

Executive summary....................................................................................................................3 

1. A moment of transformation........................................................................................5 

2. Smart, sustainable and inclusive growth......................................................................8 

3. Missing links and bottlenecks....................................................................................18 

4. Exit from the crisis: first steps towards 2020.............................................................22 

5. Delivering results: stronger governance.....................................................................25 

6. Decisions for the European Council..........................................................................28 

Annexes ....................................................................................................................................30 


EUROPE 2020 STRATEGY 
EXECUTIVE SUMMARY 

Europe faces a moment of transformation. The crisis has wiped out years of economic and 
social progress and exposed structural weaknesses in Europe's economy. In the meantime, the 
world is moving fast and long-term challenges  globalisation, pressure on resources, ageing 
 intensify. The EU must now take charge of its future. 

Europe can succeed if it acts collectively, as a Union. We need a strategy to help us come out 
stronger from the crisis and turn the EU into a smart, sustainable and inclusive economy 
delivering high levels of employment, productivity and social cohesion. Europe 2020 sets out 
a vision of Europe's social market economy for the 21st century. 

Europe 2020 puts forward three mutually reinforcing priorities: 
 Smart growth: developing an economy based on knowledge and innovation. 
 Sustainable growth: promoting a more resource efficient, greener and more competitive 
economy. 


 Inclusive growth: fostering a high-employment economy delivering social and territorial 
cohesion. 

The EU needs to define where it wants to be by 2020. To this end, the Commission proposes 
the following EU headline targets: 
 75 % of the population aged 20-64 should be employed. 
 3% of the EU's GDP should be invested in R&D. 
 The "20/20/20" climate/energy targets should be met (including an increase to 30% of 
emissions reduction if the conditions are right). 
 The share of early school leavers should be under 10% and at least 40% of the younger 
generation should have a tertiary degree. 


 20 million less people should be at risk of poverty. 

These targets are interrelated and critical to our overall success. To ensure that each Member 
State tailors the Europe 2020 strategy to its particular situation, the Commission proposes that 
EU goals are translated into national targets and trajectories. 

The targets are representative of the three priorities of smart, sustainable and inclusive growth 
but they are not exhaustive: a wide range of actions at national, EU and international levels 
will be necessary to underpin them. The Commission is putting forward seven flagship 
initiatives to catalyse progress under each priority theme: 
 "Innovation Union" to improve framework conditions and access to finance for research 
and innovation so as to ensure that innovative ideas can be turned into products and 
services that create growth and jobs. 
 "Youth on the move" to enhance the performance of education systems and to facilitate the 
entry of young people to the labour market. 



 "A digital agenda for Europe" to speed up the roll-out of high-speed internet and reap the 
benefits of a digital single market for households and firms. 
 "Resource efficient Europe" to help decouple economic growth from the use of resources, 
support the shift towards a low carbon economy, increase the use of renewable energy 
sources, modernise our transport sector and promote energy efficiency. 
 "An industrial policy for the globalisation era" to improve the business environment, 
notably for SMEs, and to support the development of a strong and sustainable industrial 
base able to compete globally. 
 "An agenda for new skills and jobs" to modernise labour markets and empower people by 
developing their of skills throughout the lifecycle with a view to increase labour 
participation and better match labour supply and demand, including through labour 
mobility. 


 "European platform against poverty" to ensure social and territorial cohesion such that the 
benefits of growth and jobs are widely shared and people experiencing poverty and social 
exclusion are enabled to live in dignity and take an active part in society. 

These seven flagship initiatives will commit both the EU and the Member States. EU-level 
instruments, notably the single market, financial levers and external policy tools, will be fully 
mobilised to tackle bottlenecks and deliver the Europe 2020 goals. As an immediate priority, 
the Commission charts what needs to be done to define a credible exit strategy, to pursue the 
reform of the financial system, to ensure budgetary consolidation for long-term growth, and to 
strengthen coordination within the Economic and Monetary Union. 

Stronger economic governance will be required to deliver results. Europe 2020 will rely on 
two pillars: the thematic approach outlined above, combining priorities and headline targets; 
and country reporting, helping Member States to develop their strategies to return to 
sustainable growth and public finances. Integrated guidelines will be adopted at EU level to 
cover the scope of EU priorities and targets. Country-specific recommendations will be 
addressed to Member States. Policy warnings could be issued in case of inadequate response. 
The reporting of Europe 2020 and the Stability and Growth Pact evaluation will be done 
simultaneously, while keeping the instruments separate and maintaining the integrity of the 
Pact. 

The European Council will have full ownership and be the focal point of the new strategy. 
The Commission will monitor progress towards the targets, facilitate policy exchange and 
make the necessary proposals to steer action and advance the EU flagship initiatives. The 
European Parliament will be a driving force to mobilise citizens and act as co-legislator on 
key initiatives. This partnership approach should extend to EU committees, to national 
parliaments and national, local and regional authorities, to social partners and to stakeholders 
and civil society so that everyone is involved in delivering on the vision. 

The Commission proposes that the European Council endorses - in March - the overall 
approach of the strategy and the EU headline targets, and approves - in June - the detailed 
parameters of the strategy, including the integrated guidelines and national targets. The 
Commission also looks forward to the views and support of the European Parliament for 
making Europe 2020 a success. 


1. A MOMENT OF TRANSFORMATION 

The crisis has wiped out recent progress 

The recent economic crisis has no precedent in our generation. The steady gains in economic 
growth and job creation witnessed over the last decade have been wiped out  our GDP fell by 
4% in 2009, our industrial production dropped back to the levels of the 1990s and 23 million 
people - or 10% of our active population - are now unemployed. The crisis has been a huge 
shock for millions of citizens and it has exposed some fundamental weaknesses of our 
economy. 

The crisis has also made the task of securing future economic growth much more difficult. 
The still fragile situation of our financial system is holding back recovery as firms and 
households have difficulties to borrow, spend and invest. Our public finances have been 
severely affected, with deficits at 7% of GDP on average and debt levels at over 80% of GDP 
 two years of crisis erasing twenty years of fiscal consolidation. Our growth potential has 
been halved during the crisis. Many investment plans, talents and ideas risk going to waste 
because of uncertainties, sluggish demand and lack of funding. 

Europe's structural weaknesses have been exposed 

Moving out of the crisis is the immediate challenge, but the biggest challenge is to escape the 
reflex to try to return to the pre-crisis situation. Even before the crisis, there were many areas 
where Europe was not progressing fast enough relative to the rest of the world: 
 Europe's average growth rate has been structurally lower than that of our main 
economic partners, largely due to a productivity gap that has widened over the last 
decade. Much of this is due to differences in business structures combined with 
lower levels of investment in R&D and innovation, insufficient use of information 
and communications technologies, reluctance in some parts of our societies to 
embrace innovation, barriers to market access and a less dynamic business 
environment. 
 In spite of progress, Europe's employment rates  at 69% on average for those aged 
20-64  are still significantly lower than in other parts of the world. Only 63% of 
women are in work compared to 76% of men. Only 46% of older workers (55-64) 
are employed compared to over 62% in the US and Japan. Moreover, on average 
Europeans work 10% fewer hours than their US or Japanese counterparts. 


 Demographic ageing is accelerating. As the baby-boom generation retires, the EU's 
active population will start to shrink as from 2013/2014. The number of people aged 
over 60 is now increasing twice as fast as it did before 2007  by about two million 
every year compared to one million previously. The combination of a smaller 
working population and a higher share of retired people will place additional strains 
on our welfare systems. 

Global challenges intensify 

While Europe needs to address its own structural weaknesses, the world is moving fast and 
will be very different by the end of the coming decade: 
 Our economies are increasingly interlinked. Europe will continue to benefit from 
being one of the most open economies in the world but competition from developed 
and emerging economies is intensifying. Countries such as China or India are 



investing heavily in research and technology in order to move their industries up the 
value chain and "leapfrog" into the global economy. This puts pressure on some 
sectors of our economy to remain competitive, but every threat is also an 
opportunity. As these countries develop, new markets will open up for many 
European companies. 
 Global finance still needs fixing. The availability of easy credit, short-termism and 
excessive risk-taking in financial markets around the world fuelled speculative 
behaviour, giving rise to bubble-driven growth and important imbalances. Europe is 
engaged in finding global solutions to bring about an efficient and sustainable 
financial system. 


 Climate and resource challenges require drastic action. Strong dependence on fossil 
fuels such as oil and inefficient use of raw materials expose our consumers and 
businesses to harmful and costly price shocks, threatening our economic security and 
contributing to climate change. The expansion of the world population from 6 to 9 
billion will intensify global competition for natural resources, and put pressure on the 
environment. The EU must continue its outreach to other parts of the world in pursuit 
of a worldwide solution to the problems of climate change at the same time as we 
implement our agreed climate and energy strategy across the territory of the Union. 

Europe must act to avoid decline 

There are several lessons we can learn from this crisis: 
 The 27 EU economies are highly interdependent: the crisis underscored the close 
links and spill-overs between our national economies, particularly in the euro area. 
Reforms, or the lack of them, in one country affect the performance of all others, as 
recent events have shown; moreover, the crisis and severe constraints in public 
spending have made it more difficult for some Member States to provide sufficient 
funding for the basic infrastructure they need in areas such as transport and energy 
not only to develop their own economies but also to help them participate fully in the 
internal market. 
 Coordination within the EU works: the response to the crisis showed that if we act 
together, we are significantly more effective. We proved this by taking common 
action to stabilise the banking system and through the adoption of a European 
Economic Recovery Plan. In a global world, no single country can effectively 
address the challenges by acting alone; 


 The EU adds value on the global scene. The EU will influence global policy 
decisions only if it acts jointly. Stronger external representation will need to go hand 
in hand with stronger internal co-ordination. 

The crisis has not just been a one-off hit, allowing us to resume "business as usual". The 
challenges that our Union faces are greater than before the recession, whilst our room for 
manoeuvre is limited. Moreover, the rest of the world is not standing still. The enhanced role 
of the G20 has demonstrated the growing economic and political power of emerging 
countries. 

Europe is left with clear yet challenging choices. Either we face up collectively to the 
immediate challenge of the recovery and to long-term challenges  globalisation, pressure on 
resources, ageing,  so as to make up for the recent losses, regain competitiveness, boost 
productivity and put the EU on an upward path of prosperity ("sustainable recovery"). 


Or we continue at a slow and largely uncoordinated pace of reforms, and we risk ending up 
with a permanent loss in wealth, a sluggish growth rate ("sluggish recovery") possibly leading 
to high levels of unemployment and social distress, and a relative decline on the world scene 
("lost decade"). 

 Output level

 

 



Three scenarios for Europe by 2020 

Scenario 1: Sustainable recovery 

Europe is able to 
make a full return to 
earlier growth path 
and raise its potential 
to go beyond 

Scenario 2: Sluggish recovery 

Europe will have 
suffered a permanent 
loss in wealth and 
start growing again 
from this eroded basis 

Scenario 3: Lost decade 

Europe will have 
suffered a permanent 
loss in wealth and 
potential for future 
growth 

Europe can succeed 

Europe has many strengths: we can count on the talent and creativity of our people, a strong 
industrial base, a vibrant services sector, a thriving, high quality agricultural sector, strong 
maritime tradition, our single market and common currency, our position as the world's 
biggest trading bloc and leading destination for foreign direct investment. But we can also 
count on our strong values, democratic institutions, our consideration for economic, social 
and territorial cohesion and solidarity, our respect for the environment, our cultural diversity, 
respect for gender equality  just to name a few. Many of our Member States are amongst the 
most innovative and developed economies in the world. But the best chance for Europe to 
succeed is if it acts collectively  as a Union. 

When confronted with major events in the past, the EU and its Member States have risen to 
the challenge. In the 1990s, Europe launched the largest single market in the world backed by 
a common currency. Only a few years ago, the division of Europe ended as new Member 
States entered the Union and other states embarked on the road towards membership or a 
closer relation with the Union. Over the last two years common action taken at the height of 



the crisis through the European Recovery Plan helped prevent economic meltdown, whilst our 
welfare systems helped protect people from even greater hardship. 

Europe is able to act in times of crisis and to adapt its economies and societies. And today 
Europeans face again a moment of transformation to cope with the impact of the crisis, 
Europe's structural weaknesses and intensifying global challenges. 

In so doing, our exit from the crisis must be the point of entry into a new economy. For our 
own and future generations to continue to enjoy a high-quality of healthy life, underpinned by 
Europe's unique social models, we need to take action now. What is needed is a strategy to 
turn the EU into a smart, sustainable and inclusive economy delivering high levels of 
employment, productivity and social cohesion. This is the Europe 2020 strategy. This is an 
agenda for all Member States, taking into account different needs, different starting points and 
national specificities so as to promote growth for all. 

2. SMART, SUSTAINABLE AND INCLUSIVE GROWTH 

Where do we want Europe to be in 2020? 

Three priorities should be the heart of Europe 20201: 
 Smart growth  developing an economy based on knowledge and innovation. 
 Sustainable growth  promoting a more resource efficient, greener and more 
competitive economy. 


 Inclusive growth  fostering a high-employment economy delivering economic, 
social and territorial cohesion. 

These three priorities are mutually reinforcing; they offer a vision of Europe's social market 
economy for the 21st century. 

To guide our efforts and steer progress, there is a large consensus that the EU should 
commonly agree on a limited number of headline targets for 2020. These targets should be 
representative of the theme of smart, sustainable and inclusive growth. They must be 
measurable, capable of reflecting the diversity of Member States situations and based on 
sufficiently reliable data for purposes of comparison. The following targets have been selected 
on this basis  meeting them will be critical to our success by 2020: 
 The employment rate of the population aged 20-64 should increase from the current 
69% to at least 75%, including through the greater involvement of women, older 
workers and the better integration of migrants in the work force; 
 The EU currently has a target of investing 3% of GDP in R&D. The target has 
succeeded in focusing attention on the need for both the public and private sectors to 
invest in R&D but it focuses on input rather than impact. There is a clear need to 
improve the conditions for private R&D in the EU and many of the measures 
proposed in this strategy will do this. It is also clear that by looking at R&D and 
innovation together we would get a broader range of expenditure which would be 
more relevant for business operations and for productivity drivers. The Commission 


1 These themes have been widely welcomed in the public consultation carried out by the Commission. 
For details of the views expressed during the consultation see: http://ec.europa.eu/eu2020/index_en.htm 


proposes to keep the 3% target while developing an indicator which would reflect 
R&D and innovation intensity; 
 Reduce greenhouse gas emissions by at least 20% compared to 1990 levels or by 
30%, if the conditions2 are right; increase the share of renewable energy sources in 
our final energy consumption to 20%; and a 20% increase in energy efficiency; 
 A target on educational attainment which tackles the problem of early school leavers 
by reducing the drop out rate to 10% from the current 15%, whilst increasing the 
share of the population aged 30-34 having completed tertiary education from 31% to 
at least 40% in 2020; 


2 The European Council of 10-11 December 2009 concluded that as part of a global and comprehensive 
agreement for the period beyond 2012, the EU reiterates its conditional offer to move to a 30% 
reduction by 2020 compared to 1990 levels, provided that other developed countries commit themselves 
to comparable emission reductions and that developing countries contribute adequately according to 
their responsibilities and respective capabilities. 

3 The national poverty line is defined as 60% of the median disposable income in each Member State. 

 The number of Europeans living below the national poverty lines should be reduced 
by 25%, lifting over 20 million people out of poverty3. 

These targets are interrelated. For instance, better educational levels help employability and 
progress in increasing the employment rate helps to reduce poverty. A greater capacity for 
research and development as well as innovation across all sectors of the economy, combined 
with increased resource efficiency will improve competitiveness and foster job creation. 
Investing in cleaner, low carbon technologies will help our environment, contribute to 
fighting climate change and create new business and employment opportunities. Meeting 
these targets should mobilise our collective attention. It will take strong leadership, 
commitment and an effective delivery mechanism to change attitudes and practices in the EU 
to deliver the results which are summarised in these targets. 

These targets are representative, not exhaustive. They represent an overall view of where the 
Commission would like to see the EU on key parameters by 2020. They do not represent a 
"one size fits all" approach. Each Member State is different and the EU of 27 is more diverse 
than it was a decade ago. Despite disparities in levels of development and standards of living 
the Commission considers that the proposed targets are relevant to all Member States, old and 
newer alike. Investing in research and development as well as innovation, in education and in 
resource efficient technologies will benefit traditional sectors, rural areas as well as high skill, 
service economies. It will reinforce economic, social and territorial cohesion. To ensure that 
each Member States tailors the Europe 2020 strategy to its particular situation, the 
Commission proposes that these EU targets are translated into national targets and trajectories 
to reflect the current situation of each Member State and the level of ambition it is able to 
reach as part of a wider EU effort to meet these targets. In addition to the efforts of Member 
States the Commission will propose an ambitious range of actions at EU level designed to lift 
the EU onto a new, more sustainable growth path. This mix of EU and national efforts should 
be mutually reinforcing. 

Smart growth  an economy based on knowledge and innovation 

Smart growth means strengthening knowledge and innovation as drivers of our future growth. 
This requires improving the quality of our education, strengthening our research performance, 
promoting innovation and knowledge transfer throughout the Union, making full use of 


information and communication technologies and ensuring that innovative ideas can be turned 
into new products and services that create growth, quality jobs and help address European and 
global societal challenges. But, to succeed, this must be combined with entrepreneurship, 
finance, and a focus on user needs and market opportunities. 

Europe must act: 
 Innovation: R&D spending in Europe is below 2%, compared to 2.6% in the US and 
3.4% in Japan, mainly as a result of lower levels of private investment. It is not only 
the absolute amounts spent on R&D that count  Europe needs to focus on the impact 
and composition of research spending and to improve the conditions for private 
sector R&D in the EU. Our smaller share of high-tech firms explains half of our gap 
with the US. 
 Education, training and lifelong learning: A quarter of all pupils have poor reading 
competences, one in seven young people leave education and training too early. 
Around 50% reach medium qualifications level but this often fails to match labour 
market needs. Less than one person in three aged 25-34 has a university degree 
compared to 40% in the US and over 50% in Japan. According to the Shanghai 
index, only two European universities are in the world's top 20. 


 Digital society: The global demand for information and communication technologies 
is a market worth  2 000 billion, but only one quarter of this comes from European 
firms. Europe is also falling behind on high-speed internet, which affects its ability to 
innovate, including in rural areas, as well as on the on-line dissemination of 
knowledge and on-line distribution of goods and services. 

Action under this priority will unleash Europe's innovative capabilities, improving 
educational outcomes and the quality and outputs of education institutions, and exploiting the 
economic and societal benefits of a digital society. These policies should be delivered at 
regional, national and EU level. 

Flagship Initiative: "Innovation Union" 

The aim of this is to re-focus R&D and innovation policy on the challenges facing our society, such as 
climate change, energy and resource efficiency, health and demographic change. Every link should be 
strengthened in the innovation chain, from 'blue sky' research to commercialisation. 

At EU level, the Commission will work: 
 To complete the European Research Area, to develop a strategic research agenda focused on challenges 
such as energy security, transport, climate change and resource efficiency, health and ageing, 
environmentally-friendly production methods and land management, and to enhance joint programming 
with Member States and regions; 
 To improve framework conditions for business to innovate (i.e. create the single EU Patent and a 
specialised Patent Court, modernise the framework of copyright and trademarks, improve access of 
SMEs to Intellectual Property Protection, speed up setting of interoperable standards; improve access to 
capital and make full use of demand side policies, e.g. through public procurement and smart 
regulation); 
 To launch 'European Innovation Partnerships' between the EU and national levels to speed up the 
development and deployment of the technologies needed to meet the challenges identified. The first will 
include: 'building the bio-economy by 2020', 'the key enabling technologies to shape Europe's industrial 
future' and 'technologies to allow older people to live independently and be active in society'; 



 To strengthen and further develop the role of EU instruments to support innovation (e.g. structural 
funds, rural development funds, R&D framework programme, CIP, SET plan), including through closer 
work with the EIB and streamline administrative procedures to facilitate access to funding, particularly 
for SMEs and to bring in innovative incentive mechanisms linked to the carbon market, namely for fast-
movers; 


 To promote knowledge partnerships and strengthen links between education, business, research and 
innovation, including through the EIT, and to promote entrepreneurship by supporting Young 
Innovative Companies. 

At national level, Member States will need: 
 To reform national (and regional) R&D and innovation systems to foster excellence and smart 
specialisation, reinforce cooperation between universities, research and business, implement joint 
programming and enhance cross-border co-operation in areas with EU value added and adjust national 
funding procedures accordingly, to ensure the diffusion of technology across the EU territory; 
 To ensure a sufficient supply of science, maths and engineering graduates and to focus school curricula 
on creativity, innovation, and entrepreneurship; 


 To prioritise knowledge expenditure, including by using tax incentives and other financial instruments 
to promote greater private R&D investments. 

 

Flagship initiative: "Youth on the move" 

The aim is to enhance the performance and international attractiveness of Europe's higher education 
institutions and raise the overall quality of all levels of education and training in the EU, combining both 
excellence and equity, by promoting student mobility and trainees' mobility, and improve the employment 
situation of young people. 

At EU level, the Commission will work: 
 To integrate and enhance the EU's mobility, university and researchers' programmes (such as Erasmus, 
Erasmus Mundus, Tempus and Marie Curie) and link them up with national programmes and resources; 
 To step up the modernisation agenda of higher education (curricula, governance and financing) including 
by benchmarking university performance and educational outcomes in a global context; 
 To explore ways of promoting entrepreneurship through mobility programmes for young professionals; 
 To promote the recognition of non-formal and informal learning; 


 To launch a Youth employment framework outlining policies aimed at reducing youth unemployment 
rates: this should promote, with Member States and social partners, young people's entry into the labour 
market through apprenticeships, stages or other work experience, including a scheme ("Your first 
EURES job") aimed at increasing job opportunities for young people by favouring mobility across the 
EU. 

At national level, Member States will need: 
 To ensure efficient investment in education and training systems at all levels (pre-school to tertiary); 
 To improve educational outcomes, addressing each segment (pre-school, primary, secondary, vocational 
and tertiary) within an integrated approach, encompassing key competences and aiming at reducing early 
school leaving; 
 To enhance the openness and relevance of education systems by building national qualification 
frameworks and better gearing learning outcomes towards labour market needs. 




 To improve young people's entry into the labour market through integrated action covering i.a guidance, 
counselling and apprenticeships. 


 

Flagship Initiative: "A Digital Agenda for Europe" 




The aim is to deliver sustainable economic and social benefits from a Digital Single Market based on fast 
and ultra fast internet and interoperable applications, with broadband access for all by 2013, access for all to 
much higher internet speeds (30 Mbps or above) by 2020, and 50% or more of European households 
subscribing to internet connections above 100 Mbps. 

At EU level, the Commission will work: 
 To provide a stable legal framework that stimulate investments in an open and competitive high speed 
internet infrastructure and in related services; 
 To develop an efficient spectrum policy; 
 To facilitate the use of the EU's structural funds in pursuit of this agenda; 
 To create a true single market for online content and services (i.e. borderless and safe EU web services 
and digital content markets, with high levels of trust and confidence, a balanced regulatory framework 
with clear rights regimes, the fostering of multi-territorial licences, adequate protection and remuneration 
for rights holders and active support for the digitisation of Europe's rich cultural heritage, and to shape 
the global governance of the internet; 
 To reform the research and innovation funds and increase support in the field of ICTs so as to reinforce 
Europe's technology strength in key strategic fields and create the conditions for high growth SMEs to 
lead emerging markets and to stimulate ICT innovation across all business sectors; 


 To promote internet access and take-up by all European citizens, especially through actions in support of 
digital literacy and accessibility. 

At national level, Member States will need: 
 To draw up operational high speed internet strategies, and target public funding, including structural 
funds, on areas not fully served by private investments; 
 To establish a legal framework for co-ordinating public works to reduce costs of network rollout; 




 To promote deployment and usage of modern accessible online services (e.g. e-government, online 
health, smart home, digital skills, security). 


Sustainable growth  promoting a more resource efficient, greener and more competitive 
economy 

Sustainable growth means building a resource efficient, sustainable and competitive economy, 
exploiting Europe's leadership in the race to develop new processes and technologies, 
including green technologies, accelerating the roll out of smart grids using ICTs, exploiting 
EU-scale networks, and reinforcing the competitive advantages of our businesses, particularly 
in manufacturing and within our SMEs, as well through assisting consumers to value resource 
efficiency. Such an approach will help the EU to prosper in a low-carbon, resource 
constrained world while preventing environmental degradation, biodiversity loss and 
unsustainable use of resources. It will also underpin economic, social and territorial cohesion. 

Europe must act: 
 Competitiveness: The EU has prospered through trade, exporting round the world 
and importing inputs as well as finished goods. Faced with intense pressure on export 
markets and for a growing range of inputs we must improve our competitiveness vis- 
a-vis our main trading partners through higher productivity. We will need to address 
relative competitiveness inside the Euro area and in the wider EU. The EU was 
largely a first mover in green solutions, but its advantage is being challenged by key 
competitors, notably China and North America. The EU should maintain its lead in 
the market for green technologies as a means of ensuring resource efficiency through 



out the economy, while removing bottlenecks in key network infrastructures, thereby 
boosting our industrial competitiveness. 
 Combating climate change: Achieving our climate goals means reducing emissions 
significantly more quickly in the next decade than in the last decade and exploiting 
fully the potential of new technologies such as carbon capture and sequestration 
possibilities. Improving resource efficiency would significantly help limit emissions, 
save money and boost economic growth. All sectors of the economy, not just 
emission-intensive, are concerned. We must also strengthen our economies' 
resilience to climate risks, and our capacity for disaster prevention and response. 


 Clean and efficient energy: Meeting our energy goals could result in  60 billion less 
in oil and gas imports by 2020. This is not only financial savings; this is essential for 
our energy security. Further progress with the integration of the European energy 
market can add an extra 0.6% to 0.8% GDP. Meeting the EU's objective of 20% of 
renewable sources of energy alone has the potential to create more than 600 000 jobs 
in the EU. Adding the 20% target on energy efficiency, it is well over 1 million new 
jobs that are at stake. 

Action under this priority will require implementing our emission-reduction commitments in 
a way which maximises the benefits and minimises the costs, including through the spread of 
innovative technological solutions. Moreover, we should aim to decouple growth from energy 
use and become a more resource efficient economy, which will not only give Europe a 
competitive advantage, but also reduce its dependency of foreign sources for raw materials 
and commodities. 




Flagship Initiative: "Resource efficient Europe" 

The aim is to support the shift towards a resource efficient and low-carbon economy that is efficient in the 
way it uses all resources. The aim is to decouple our economic growth from resource and energy use, 
reduce CO2 emissions, enhance competitiveness and promote greater energy security. 

At EU level, the Commission will work: 
 To mobilise EU financial instruments (e.g. rural development, structural funds, R&D framework 
programme, TENs, EIB) as part of a consistent funding strategy, that pulls together EU and national 
public and private funding; 
 To enhance a framework for the use of market-based instruments (e.g. emissions trading, revision of 
energy taxation, state-aid framework, encouraging wider use of green public procurement); 
 To present proposals to modernise and decarbonise the transport sector thereby contributing to 
increased competitiveness. This can be done through a mix of measures e.g. infrastructure measures 
such as early deployment of grid infrastructures of electrical mobility, intelligent traffic management, 
better logistics, pursuing the reduction of CO2 emissions for road vehicles , for the aviation and 
maritime sectors including the launch of a major European "green" car initiative which will help to 
promote new technologies including electric and hybrid cars through a mix of research, setting of 
common standards and developing the necessary infrastructure support; 
 To accelerate the implementation of strategic projects with high European added value to address 
critical bottlenecks, in particular cross border sections and inter modal nodes (cities, ports, logistic 
platforms); 
 To complete the internal energy market and implement the strategic energy technologies (SET) plan, 
promoting renewable sources of energy in the single market would also be a priority; 
 To present an initiative to upgrade Europe's networks, including Trans European Energy Networks, 
towards a European supergrid, "smart grids" and interconnections in particular of renewable energy 
sources to the grid (with support of structural funds and the EIB). This includes to promote 
infrastructure projects of major strategic importance to the EU in the Baltic, Balkan, Mediterranean 
and Eurasian regions; 
 To adopt and implement a revised Energy Efficiency Action Plan and promote a substantial 
programme in resource efficiency (supporting SMEs as well as households) by making use of 
structural and other funds to leverage new financing through existing highly successful models of 
innovative investment schemes; this should promote changes in consumption and production patterns; 


 To establish a vision of structural and technological changes required to move to a low carbon, 
resource efficient and climate resilient economy by 2050 which will allow the EU to achieve its 
emissions reduction and biodiversity targets; this includes disaster prevention and response, harnessing 
the contribution of cohesion, agricultural, rural development, and maritime policies to address climate 
change, in particular through adaptation measures based on more efficient use of resources, which will 
also contribute to improving global food security. 

At national level, Member States will need: 
 To phase out environmentally harmful subsidies, limiting exceptions to people with social needs; 
 To deploy market-based instruments such as fiscal incentives and procurement to adapt production and 
consumption methods; 
 To develop smart, upgraded and fully interconnected transport and energy infrastructures and make 
full use of ICT; 
 To ensure a coordinated implementation of infrastructure projects, within the EU Core network, that 
critically contribute to the effectiveness of the overall EU transport system; 
 To focus on the urban dimension of transport where much of the congestion and emissions are 
generated; 
 To use regulation, building performance standards and market-based instruments such as taxation, 





subsidies and procurement to reduce energy and resource use and use structural funds to invest in 
energy efficiency in public buildings and in more efficient recycling; 




 To incentivise energy saving instruments that could raise efficiency in energy-intensive sectors, such 
as based on the use of ICTs. 


 

Flagship Initiative: "An industrial policy for the globalisation era" 

Industry and especially SMEs have been hit hard by the economic crisis and all sectors are facing the 
challenges of globalisation and adjusting their production processes and products to a low-carbon 
economy. The impact of these challenges will differ from sector to sector, some sectors might have to 
"reinvent" themselves but for others these challenges will present new business opportunities. The 
Commission will work closely with stakeholders in different sectors (business, trade unions, academics, 
NGOs, consumer organisations) and will draw up a framework for a modern industrial policy, to support 
entrepreneurship, to guide and help industry to become fit to meet these challenges, to promote the 
competitiveness of Europes primary, manufacturing and service industries and help them seize the 
opportunities of globalisation and of the green economy. The framework will address all elements of the 
increasingly international value chain from access to raw materials to after-sales service. 

At EU level, the Commission will work: 
 To establish an industrial policy creating the best environment to maintain and develop a strong, 
competitive and diversified industrial base in Europe as well as supporting the transition of 
manufacturing sectors to greater energy and resource efficiency; 
 To develop a horizontal approach to industrial policy combining different policy instruments (e.g. 
"smart" regulation, modernised public procurement, competition rules and standard setting); 
 To improve the business environment, especially for SMEs, including through reducing the transaction 
costs of doing business in Europe, the promotion of clusters and improving affordable access to 
finance; 
 To promote the restructuring of sectors in difficulty towards future oriented activities, including 
through quick redeployment of skills to emerging high growth sectors and markets and support from 
the EU's state aids regime and/or the Globalisation Adjustment Fund; 
 To promote technologies and production methods that reduce natural resource use, and increase 
investment in the EU's existing natural assets; 
 To promote the internationalisation of SMEs; 
 To ensure that transport and logistics networks enable industry throughout the Union to have effective 
access to the Single Market and the international market beyond; 
 To develop an effective space policy to provide the tools to address some of the key global challenges 
and in particular to deliver Galileo and GMES; 
 To enhance the competitiveness of the European tourism sector; 
 To review regulations to support the transition of service and manufacturing sectors to greater resource 
efficiency, including more effective recycling; to improve the way in which European standard setting 
works to leverage European and international standards for the long-term competitiveness of European 
industry. This will include promoting the commercialisation and take-up of key enabling technologies; 


 To renew the EU strategy to promote Corporate Social Responsibility as a key element in ensuring 
long term employee and consumer trust. 

At national level, Member States will need: 
 To improve the business environment especially for innovative SMEs, including through public sector 
procurement to support innovation incentives; 
 To improve the conditions for enforcing intellectual property; 
 To reduce administrative burden on companies, and improve the quality of business legislation; 





 To work closely with stakeholders in different sectors (business, trade unions, academics, NGOs, 
consumer organisations) to identify bottlenecks and develop a shared analysis on how to maintain a 
strong industrial and knowledge base and put the EU in a position to lead global sustainable 
development. 


Inclusive growth  a high-employment economy delivering economic, social and territorial 
cohesion 

Inclusive growth means empowering people through high levels of employment, investing in 
skills, fighting poverty and modernising labour markets, training and social protection 
systems so as to help people anticipate and manage change, and build a cohesive society. It is 
also essential that the benefits of economic growth spread to all parts of the Union, including 
its outermost regions, thus strengthening territorial cohesion. It is about ensuring access and 
opportunities for all throughout the lifecycle. Europe needs to make full use of its labour 
potential to face the challenges of an ageing population and rising global competition. Policies 
to promote gender equality will be needed to increase labour force participation thus adding to 
growth and social cohesion. 

Europe must act: 
 Employment: Due to demographic change, our workforce is about to shrink. Only 
two-thirds of our working age population is currently employed, compared to over 
70% in the US and Japan. The employment rate of women and older workers are 
particularly low. Young people have been severely hit by the crisis, with an 
unemployment rate over 21%. There is a strong risk that people away or poorly 
attached to the world of work lose ground from the labour market. 
 Skills: About 80 million people have low or basic skills, but lifelong learning 
benefits mostly the more educated. By 2020, 16 million more jobs will require high 
qualifications, while the demand for low skills will drop by 12 million jobs. 
Achieving longer working lives will also require the possibility to acquire and 
develop new skills throughout the lifetime. 


 Fighting poverty: 80 million people were at risk of poverty prior to the crisis. 19 
million of them are children. 8 per cent of people in work do not earn enough to 
make it above the poverty threshold. Unemployed people are particularly exposed. 

Action under this priority will require modernising, strengthening our employment education 
and training policies and social protection systems by increasing labour participation and 
reducing structural unemployment, as well as raising corporate social responsibility among 
the business community. Access to childcare facilities and care for other dependents will be 
important in this respect. Implementing flexicurity principles and enabling people to acquire 
new skills to adapt to new conditions and potential career shifts will be key. A major effort 
will be needed to combat poverty and social exclusion and reduce health inequalities to ensure 
that everybody can benefit from growth. Equally important will be our ability to meet the 
challenge of promoting a healthy and active ageing population to allow for social cohesion 
and higher productivity. 

Flagship Initiative: "An Agenda for new skills and jobs" 

The aim is to create conditions for modernising labour markets with a view to raising employment levels 
and ensuring the sustainability of our social models. This means empowering people through the 
acquisition of new skills to enable our current and future workforce to adapt to new conditions and 



