18 Oct 2019

The single market remains the decisive power of the EU

Jacques Pelkmans

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The EU’s single market should not just be one among several priorities for the new Commission and Parliament. The single market was and is the core business of the EU. Much of what goes on or is proposed under elaborate titles is actually part and parcel of the single market. The striking revelation of Brexit for many EU citizens and all businesses is precisely the centrality of the single market (including the customs union) to EU membership. Its value is first of all economic, of course, as it yields higher prosperity. However, it is critical in other arenas where ‘EU clout’ derived from the single market matters, such as multilateral and bilateral trade negotiations, global climate deals, standard setting, rule-making for international financial stability and even foreign policy.

However, this unique asset deserves more explicit EU and member state attention and action in a number of its composite areas. The new Commission and the new Parliament should not and cannot take the EU single market for granted. And the member states or the Council should make sure that their endorsement of the importance of the EU single market is followed up and substantiated in dossiers where ‘market integration deficits’ (like in services) still prevail. With respect to the latter, the Council has clearly underperformed. Member states should also be much more vigilant in matters of implementation and enforcement, even though this might not be so visible politically. For while the EU is built upon decentralised implementation and enforcement, this gives member states an inescapable responsibility to ensure the proper working of the single market.

These core issues are briefly addressed below. The single market is first discussed in a more analytical fashion, for the simple reason that the Juncker Commission relabelled many single market initiatives under new headings (often ‘unions’). Whether or not President-elect von der Leyen keeps those labels, it is crucial to distinguish the single market forest from the trees as the relevant terrain for the near future. This is followed by a brief discussion of the persistent difficulties in accomplishing the single market for services. The quality of the single market, in particular how competitive it is and how well it serves consumers, is dealt with subsequently, followed by the issue of ‘fairness’ in several appearances, e.g. in EU competition policy and for workers, including intra-EU cross-border workers. This paper ends by discussing the challenges with respect to the single market that the EU must address effectively. We refer to the recent ‘strategic agenda’, Brexit, economic convergence, the ‘domestic’ governance of the single market by member states, the services conundrum and the critical significance of the single market (and not just ‘more money’ and R&D networking) for fostering new technologies and related start-ups. Altogether, the three EU institutions ought to give unwavering priority to the single market in all its dimensions.