Many European countries have not been adapting their economic, social and legal frameworks - set up under very different conditions - rapidly enough to face these challenges. At the same time, the age structure of Europe is getting increasingly unfavourable.
In facing this challenge, the options are limited; we need to adjust our regulatory frameworks in product, labour and financial markets in a way that competitiveness and economic dynamism are maintained. Some countries in the euro area, which have done well in terms of maintaining high output and employment growth, demonstrate that such changes are possible not only outside Europe but also within.