By Jonty Bloom BBC News economics correspondent

Made in Britain - with a little help from Germany

The leaders of the European Union will gather in the splendour of Hampton Court on the banks of the Thames, on Thursday, for an informal summit on Europe's economy and the challenges it faces, especially from globalisation.

With unemployment almost half the European average in the UK, and with higher economic growth in recent years than its European rivals, Britain obviously feels that it has found at least some of the answers.

But the Hampton Court summit is unlikely to be a success if it turns into a lecture by the British on how the rest of the EU needs to be more like Britain.

Many in Europe don't regard Britain as being quite such a great economic success story.

Longer hours

Take labour productivity. In the long run it is one of the key determinants of prosperity, yet output per hour worked in Britain is 20% or so below France's and Germany's.

It seems that British workers just aren't as efficient as those in many other parts of Europe, meaning they have to work much longer hours to enjoy the same living standards.

But the statistic which most puzzles economists is that foreign owned factories in Britain are also much more efficient.

"American owned plants are 90% more efficient than similar British owned companies," says John Dowdy, of business consultants McKinsey.

"The average for foreign owned plants in the UK is 50% greater productivity," he says.

Mini magic

Our working practices are different, our relationships with the trade unions are very, very different Paul Chantry, deputy manager at BMW's Cowley factory

A classic example of those figures can be found at BMW's Cowley car plant in Oxford, home of the new Mini.

The plant used to be owned by Rover, but BMW held on to it when it sold the rest of the UK car company - and it is easy to see why.

BMW is turning out 190,000 cars a year and employs 4,500 people, and the German company is spending hundreds of millions of pounds expanding the factory.

Paul Chantry, who has worked for both Rover and BMW and is now the deputy manager at Cowley, says many things have changed.

"Our working practices are different, our relationships with the trade unions are very, very different; we have worked together to develop flexible practices and working time models so we can meet customer demand in a very flexible and agile way, that we didn't have before," he says.

Management problems

But investment and better relationships with staff are not the only factors where Britain's record on productivity appears to be trailing.

One of the main factors is management itself. Many British managers just aren't as well qualified or trained as foreign rivals.

And then there is the small matter of what products are made.

BMW's Cowley plant could be inefficient and still make money because people around the world are willing to pay top prices for the Mini.

Britain is failing to invest in design and research, says Nick Matthews of the Manufacturing Group at Warwick University.

"We do not have a big enough and strong enough product base and therefore productivity without products is a bit meaningless," he says. "We need to create new products and have an environment where innovation is on the agenda".

China factor

Of course, there are many sectors of the British economy that are world class, such as pharmaceuticals and defence and aerospace.

The CBI's boss believes Britain has lessons for Germany

Britain has a much larger services sector than most of Europe, and specialises in banking, insurance and accountancy.

Some argue that this is a good thing. They say Britain has got out of businesses it wasn't very good at and which can be done much more cheaply in China and India.

"One of the reasons why Germany exports about four times as much as we do to China is because they still have an engineering and machine tool manufacturing sector," says Sir Digby Jones, director general of business leaders' group the CBI.

"China will start doing what Germany does in that sector and then they will pay a huge price because what they haven't done is face the challenge of restructuring into tomorrow's economy as Britain has."

However, whether the German government sees it that way at Hampton Court is another matter.

German unemployment may well be double that of the Britain, but in August Germany posted a trade surplus of 12.6bn euros (�8.5bn; $15.2bn), while Britain had a trade deficit of around 8bn euros.