Council Conclusions

of 13 May 2003

on "industrial competitiveness in an enlarged Europe"

(2003/C 149/01)

THE COUNCIL OF THE EUROPEAN UNION,

1. RECALLING:

- the conclusions of the Lisbon European Council on the strategy for making the EU the world's most competitive and dynamic knowledge-based economy, capable of sustainable economic growth with more and better jobs and greater social cohesion by 2010 and the further elaboration of this strategy by the Stockholm, Gothenburg and Barcelona European Councils;

- the conclusions of the Barcelona Council which agreed that overall spending on R & D and innovation in the Union should be increased with the aim of approaching 3 % of GDP by 2010;

- the conclusions of the Seville European Council which welcomed the Action Plan for simplifying and improving the regulatory environment;

- the conclusions of the Copenhagen European Council concerning enlargement;

- the Council conclusions of 3 March 2003 on the promotion of entrepreneurship and small firms;

- the contribution of the Competitiveness Council to the Spring European Council 2003 adopted on 3 March 2003;

- the conclusions of the Brussels European Council of 20 and 21 March 2003, which noted that in boosting European competitiveness, a new approach to industrial policy will be important.

2. WELCOMES the Commission's Communication on "Industrial Policy in an Enlarged Europe", which stresses the importance of the contribution of industry to competitiveness.

3. RECOGNISES:

- that the slowdown in productivity growth in the EU presents a challenge to attaining the goals of the Lisbon strategy and requires effective action to be taken in response;

- the opportunities and the challenges in the industrial sector, arising from the enlargement of the European Union, as well as those resulting in particular from technological and organisational change, new societal demands and globalisation, including increased competition in world markets; also recognising different global framework conditions;

- the vital role industry has to play in implementing the objectives defined at the Lisbon European Council and in the framework of the European Union's strategy for sustainable development;

- the need to re-examine industrial competitiveness policy, reflected in various Council resolutions and conclusions and/or in several Commission papers and communications, with a view to adapting it to current circumstances, as part of the Council's horizontal role in ensuring an integrated approach to the enhancement of competitiveness and growth.

4. EMPHASISES:

- that industrial policy is horizontal in nature and involves the application of enterprise policy instruments. It aims at securing framework conditions favourable to industrial competitiveness, while taking into account the specific needs and characteristics of individual sectors;

- that the coherence between the different Community policies requires that the balance between the three pillars of sustainable development - economic, social and environmental - is such that competitiveness is improved;

- that an effective industrial policy implies the search for the appropriate balance between the different objectives of Community policies that have an impact on the competitiveness of industry;

- the importance of actively pursuing efforts to develop knowledge, innovation and entrepreneurship as key factors affecting industrial competitiveness;

- that due attention should be given to the needs of small firms in the conception and application of industrial policy;

- the interdependence of industry and services and their importance for EU competitiveness, bearing in mind the specific needs of SMEs;

- that a high level of social cohesion, training and education, are core aspects of the knowledge economy as well as of competitiveness;

- the importance of competition policy in reinforcing global industrial competitiveness, while ensuring complementarity and synergies between competition and industrial policy;

- the importance of the early implementation of the action plan on risk capital along the EU;

- the importance of ensuring the full implementation of the internal market, including for services, for the creation and development of businesses in Europe;

- that a well developed infrastructure and integrated energy, transport and telecommunications networks are essential for the good functioning of the internal market and for competitiveness, in particular in view of enlargement. In this respect the targets set by the Barcelona European Council must be fully met, taking due account of services of general interest;

- that the frameworks, institutions and instruments, necessary to the business environment and for industry are in place and function efficiently;

- the need to encourage enterprises, to make effective use of information and communication technologies, new management techniques and manpower training to improve substantially productivity, and to invest more in R & D and innovation.

5. INVITES THE MEMBER STATES AND ACCEDING COUNTRIES TO:

- contribute actively, through their instruments of industrial policy, to implementing the objectives of the Lisbon strategy and the sustainable development strategy;

- strive to improve the coherence between different national and regional policies having an impact on industrial competitiveness;

- apply, where appropriate, the principle of "think small first" when designing new or reviewing existing legal instruments;

- contribute to increasing the competitiveness of European industry by undertaking systematic impact assessment taking into account national practices and legal systems, as well as consultation on future legislation, notably by ensuring full involvement of stakeholders;

- ensure that innovation and research are encouraged by facilitating and stimulating the emergence of innovative clusters and networks, thus contributing to industrial competitiveness and to the improvement of the environment for entrepreneurship;

- take all necessary steps to ensure a sustained and measurable improvement in the way the internal market function, in particular by speeding up the transposition of relevant Community legislation;

- continue their efforts to enforce competition policy and to reduce the overall level of State aid and redirect it towards horizontal objectives of common interest, including cohesion objectives, and inter alia, R & D and innovation.

6. INVITES THE COMMISSION TO:

- intensify the work on a new approach to industrial policy;

- report, on a regular basis, on the progress and especially on the means of improving the integration of different Community policies having an impact on industrial competitiveness;

- pursue its work on the action plan "Simplifying and improving the regulatory environment", integrating the concept "think small first" and improving regulation affecting competitiveness, including the new approach to product policy and developing European standards, and to assess, where appropriate, the use of alternatives to legislation to avoid excessive administrative burdens;

- continue developing the extended impact assessment and systematic consultation of interested parties on all major proposed EU legislation to ensure a balanced approach to the policies affecting the competitiveness of enterprises and to ensure that European enterprises operate on a level playing field in the global economy;

- inform the Council as early as possible about proposals which will be subject to an extended impact assessment and, when available, about the results thereof, thus facilitating the identification of those proposals considered likely to have a substantial effect on competitiveness;

- examine the competitiveness of industrial sectors, currently subject to important competitive challenges and propose, if necessary, any useful initiatives to improve their competitiveness, keeping in mind the SME dimension;

- examine the operating environment for emerging industries in order to stimulate economic activity and new global leadership based on emerging technologies;

- analyse the needs and specific characteristics of industry and the impact of enlargement on competitiveness and take account of the findings when proposing new initiatives;

- examine in the wider context of the Commission's services strategy, the contribution of services to the competitiveness of European industry.

7. INVITES THE MEMBER STATES, ACCEDING COUNTRIES AND THE COMMISSION TO:

- exchange on a regular basis information on their respective industrial and competitiveness policies and build on the use of the Best Procedure to identify critical factors and propose policy recommendations;

- examine ways of developing synergies and, by focussing on concrete implementation, improve the exchange of information and best practice in the different domains relating to industrial policy, taking into account national and regional specificities, and applying an open method of coordination, which includes a peer review process, on a voluntary basis;

- establish, within the context of the Council's ongoing work on an integrated strategy for competitiveness, a roadmap on the concrete ways in which industrial policy can contribute to achieving the Lisbon objectives, particularly in the framework of a sustainable development strategy, and monitor progress.