The EU is losing its battle to become the world's most competitive economy by 2010 because of sluggish growth and lack of political will to promote economic reforms, the European Commission will warn today, the Financial Times reported.
The document on the economic future of the European Union highlights the risks of a "two-tier" Europe where some countries -- such as Sweden and Denmark -- are doing much better than others such as Greece, Italy and France, the daily said.
The Commission warns that the difference in performance will be exacerbated by the accession of another 10 countries, mostly from eastern Europe, in 2004.
The document sets out the Commission's position ahead of an EU summit in March.
"It could raise tensions with some EU governments, such as France and Germany, which take a dim view of Brussels' reprimands on economic reform," the paper said.
The Brussels summit will have to look at how to push on with ambitious economic reforms -- aimed at making the EU more competitive than the US and Japan by the end of the decade -- launched at the 2000 Lisbon summit.
The Commission urges the 15 EU governments to implement reforms in their labor, product and capital markets this year.
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