The world economy faces challenges from the new powerhouses of China and India (see Nos 263 and 264/265, 2007). In order to compete, there is a case for closer co-operation between developed countries and, in particular, tighter integration in Europe.
The idea of the single currency is to remove barriers, but the project is hindered by a lack of labour mobility. Currently only 4% of the EU population are working outside their home countries.Banking is still highly fractured. Intra-EU migration would be greatly facilitated by making it easier for EU citizens to open foreign bank accounts in other EU countries. Likewise, access to EU-wide social services is hampered by red tape and mobile phone roaming charges are excessive.Sadly, rather than address these human level issues, European leaders are caught up on Strasbourg-level infrastructural issues, like commissionerships and voting rights. The current Lisbon treaty debate is a turn-off for the public and deflects attention from a serious impediment to economic growth.Mark Simons
©OECD Observer No 266 March 2008