Gathered at the World Economic Summit in Warsaw on the eve of the May 1 enlargement, executives and economists said the addition of 10 new members would boost the bloc's global clout and become a catalyst for badly needed reforms.

"EU enlargement is a terrific opportunity to start reconstructing our vision of Europe," Unilever Chairman Antony Burgmans said on the fringes of the summit.

Lower taxes, cheaper labour and growing efficiency in central European countries as well as their skilled workforce should help the enlarged Europe boost its position against rapidly growing Asian and US rivals, he said.

"East European countries will be very competitive, partly due to low taxes," Burgmans said.

Low taxes in "New Europe" have become a contagious issue for some of the 15 current EU members, particularly those with high taxation, slow growth and big unemployment.

German Chancellor Gerhard Schroeder, presiding over the EU's largest, but sputtering, economy, has led the charge, criticising low taxes behind Germany's eastern border and chiding businesses planning to move production east.

Economists say, however, that the source of the problem were delayed economic reforms in Germany and other EU members.

They back views of other EU governments, such as Britain's, that competition from new members will help create new momentum for reform across the rich bloc.