Europe's goal of becoming the world's most dynamic knowledge-based economy by 2010 is at risk as states with budget woes are cutting investment in technology,European Commission President Romano Prodi said today.
"If you look at the budget strategies of a number ofEuropean countries, the first cuts made in any period ofdifficulty is made in that very area of potential investment, intechnology," Mr Prodi told the European Parliament.
"It is all very well to talk about our aims of progress andliberalisation (but) all of this can be shelved if we don't makethe necessary investments. It is a crucial problem," he said.
The comments come a day after the European Commission tookthe first step in disciplining Germany for breaking EU budgetdeficit limits and asked finance ministers to warn Franceofficially that it too risked breaking the bloc's budget rules.
Mr Prodi also said EU budget rules had to be appliedintelligently, repeating a comment he has made several timessince October when he described the Stability and Growth Pact onbudget discipline as "stupid".