The riots in France against increased labour market flexibility are counterproductive, the European commissioner for internal markets and services, Charlie McCreevy, said yesterday.

Addressing the annual conference of the Institute of Chartered Accountants in Ireland (ICAI) in Galway, he said flexibility, entrepreneurship, risk-taking and innovation were the keys to Europe's economic future.

Some European countries were performing well, but others were not. "Failure to reform, to adapt to the new global realities, has been holding them back."

Overcoming resistance to reform "requires leadership, staying power and determination, not being tempted to bend to the pressures of the street" or the results of opinion polls.

Mr McCreevy said he did not believe the "politically cute thing to do" was to deceive people into thinking change could be resisted. The pace of global change and the strength of competitive forces meant business must be more flexible.

"That is a reality that has yet to sink in for one or two member states who have a great and a proud past, but whose people now live in fear of the future."

He said a "protectionist wave" was spreading across the EU and threatening to drown the internal market. He said he would fight against protectionist measures "without fear or favour".

Mr McCreevy said those listening may be full-time professionals or "out and about" in the world of industry, finance and commerce. But they were all inter-dependent: "Auditing one another, buying or selling to one another, renting or leasing to one another, manufacturing or building for one another. Maybe some of you are even sleeping with one another."