The Taosieach, Mr Ahern, has told the World Economic Forum in Davos, Sitzerland, that competitiveness is the key to more jobs in Europe.
He said "the gulf between the EU's ambition to be the most competitive and dynamic knowledge-based economy in the world and the reality, is still very wide."
"We are still some way behind the United States and other global economies," he conceded.
Mr Ahern also told the forum that it was a time for reflection on the rules of the stability and growth pact.
"My own view is that a period of reflection on the rules of the Stability Pact, and on how these rules operate to support growth and prosperity, would be useful at this time," Mr Ahern said.
He said enlargement poses both challenges and opportunites for the European economy, saying income levels in the ten states due to join in May is "unacceptably low" and must be a priority.
"Ireland is perhaps the best example of a member state that has, over the course of its membership, achieved full economic convergence from a position on accession of 60 per cent of the EU's average GDP per capita. That success could not have been achieved without EU membership," he said.
Progressing the Lisbon Agenda, which aims to make the EU the most competitive economy in the world by 2010, has seen "mixed" results since it was agreed in 2000, the Taoisseach said.
"Europe's recent economic performance has been disappointing. We need to give fresh impetus to what we have set out to achieve.
If we do not do so, then Europe will continue to lag and we will not reach our full potential."
He said, however, that there are signs of a general economic upturn.