Robin Niblett and Claire Spencer
A key part of the euro problem is the fear in capitals and financial markets that the EU is fracturing between a globally competitive North and an uncompetitive South. Whatever short or long-term fixes EU leaders agree, the states of southern
Part of the answer clearly lies within the states themselves. But there is a limit to how quickly growth can be achieved by de-regulating labour markets, privatising state industries, reforming educational and welfare systems, and improving public administrations. Given the competitive advantages that northern EU states such as
An additional strategy would be to build
Rapid growth
For example, internationally competitive Spanish, Italian and French agro-industries would benefit if they could integrate Moroccan and Tunisian agricultural exports into a longer chain of mutual economic benefit.
The EU's experience since the 1990s in integrating the new democracies of central
Catalyst for reform
This would be a significant break with the past. EU trade with the entire Mediterranean littoral, excluding
North African and Arab Mediterranean states are still struggling to diversify and expand their private sectors away from privilege and protectionism. As a result, EU investment has been drawn to other newly emerged markets. Stocks of European foreign direct investment in
The risk now is that these figures could get worse, as political instability in
The EU has not been idle in the face of Arab uprisings. In
But the EU's offers do not convey the idea of a shared approach to each side's future economic success. They are still couched in the language of benign, but detached concern for poorer neighbours to the South. There is no sense of how the proposed initiatives will help address
The risk then is that these new EU initiatives, as with others before it such as the 1995 Barcelona Process and the 2008
Today, however, the context is different. When Spanish youth unemployment is on a par with joblessness in northern
For the sake of its own security and prosperity, as well as that of its North African and other Arab neighbours, the EU needs to help the South of
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