Europe, held back by France and Germany, is losing the race in education and higher qualifications faced with dogged competition from Asia, especially India and China, according to a study released today.

The study, by Andreas Schleicher from the Organisation for Economic Cooperation and Development (OECD), warns Europe to revolutionise its schools and universities and tackle class bias.

"The time when Europe competed mostly with countries that offered low-skilled work at low wages has gone. Today, countries like China and India are starting to deliver high skills at low costs," Schleicher wrote.

"This is profoundly changing the rules of the game," said the study, compiled for the Lisbon Council, a Brussels-based think tank which aims to make Europe more competitive.

Schleicher claims that increased spending on education, particularly at secondary and tertiary school levels, brings economic benefits that outstrip inflation, not just for individuals but entire countries.

He points to the "miracle" of South Korea, which in the 1960s had lower income rates than all South American countries yet now has the highest rate of education - 97 per cent - among people aged 25-34 in the industrialised world.

Meanwhile most of the big European economies, including Britain, France and Italy, are struggling to hold their rank while Germany has even fallen.

" France and Germany, which make up 35 per cent of the European Union's 11.6 trillion euro economy, are no longer among the world's leaders in developing knowledge and skills," the study said.

(www.financialexpress.com)