Changes

===Growth===

===Growth===

The EU is the world's largest economic area (the U.S. is second) with a 2007 GDP of $16.6 trillion; however, growth in many western Member States in the recent past has been slow compared to those in the east. Between 2001 and 2003, the overall growth rate dropped from 1.8 percent to 1.0 percent. The EU economy staged a,short-lived recovery in 2004 of 2.4%, but fell to 1.8 percent in 2005, then rose to 2.8% in 2006 and 2.4% in 2007. Within the euro area, growth varies as much as 4.5 percentage points between the fastest and slowest-growing economies. In 2005, many of the EU's largest economies, including Germany, France and Italy, grew by less than two percent. Outside the euro area, growth remains strong, particularly in the Central and Eastern European countries that joined the EU in May 2004.

The EU is the world's largest economic area (the U.S. is second) with a 2007 GDP of $16.6 trillion. Growth in many western member states has been slow compared to those in the east; between 2001 and 2003, the overall growth rate dropped from 1.8 percent to 1.0 percent, then recovered in 2004 to 2.4%, fell to 1.8 percent in 2005, then rose to 2.8% in 2006 and 2.4% in 2007. Within the euro area, growth varies as much as 4.5 percentage points between the fastest and slowest-growing economies: in 2005, the economies of Germany, France and Italy, grew by less than two percent. Growth remains strong in the new central- and eastern-European member states with rapidly industrializing economies.

In spring 2000, the EU committed to a ten-year strategic goal of transforming the EU into a more competitive, knowledge-based economy capable of sustaining higher levels of growth. Focusing on labor market reform, macroeconomic and fiscal policy, and promotion of e-commerce and entrepreneurship, the EU's "Lisbon Agenda" was an attempt to stimulate growth while remaining committed to the EU social model. Some suggest that it has so far failed to achieve its goals in large part because national governments (which retain authority over employment policy, immigration, large public sector workforces, entitlement programs and pensions) have not completed the necessary reforms. With unemployment at 6.9 percent in 2007, generous social programs continue to strain national economies. The European Commission re-launched the Lisbon Agenda in March 2005, promising three percent growth and six million new jobs by 2010. The revamped strategy focuses on developing political consensus within Member States to make the changes necessary to complete elimination of barriers in the internal market, reduce the regulatory burden on business, improve labor market flexibility, provide incentives to work and increase investment in human capital.  

In spring 2000, the EU committed to a ten-year strategic goal of transforming the EU into a more competitive, knowledge-based economy capable of sustaining higher levels of growth. Focusing on labor market reform, macroeconomic and fiscal policy, and promotion of e-commerce and entrepreneurship, the EU's "Lisbon Agenda" was an attempt to stimulate growth while remaining committed to the EU social model. Some suggest that it has so far failed to achieve its goals in large part because national governments (which retain authority over employment policy, immigration, large public sector workforces, entitlement programs and pensions) have not completed the necessary reforms, with unemployment at 6.9 percent in 2007. The European Commission re-launched the Lisbon Agenda in March 2005, promising three percent growth and six million new jobs by 2010. The revamped strategy focuses on developing political consensus within member states to make the changes necessary to complete elimination of barriers in the internal market, reduce the regulatory burden on business, improve labor market flexibility, provide incentives to work and increase investment in human capital.

===Fiscal and Monetary Policy===

===Fiscal and Monetary Policy===