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Single Market 30 years on: freeing the paper tiger

Latest News 17 Jan 2023

The EU Single Market is the bedrock of the European economy and one of the greatest achievements of European integration. The world’s largest trading bloc. 30 years on from its foundation, the rules drafted to establish a harmonised footing look increasingly like a paper tiger, with so much common infrastructure still to be built. 

Freeing the paper tiger would help bring shared financial gains. About 70% of businesses rate different national legislations as a significant or extremely significant obstacle to doing cross-border trade in the Single Market [1]. Efforts to make home appliances increasingly more sustainable are one example. There, “If countries take different routes on sustainability, the many fragmented national measures multiply the number of formats required for the same product to meet national requirements,” explained Paolo Falcioni, APPLiA Director General, in turn generating “a financial burden for companies that would otherwise manufacture a single product for all 27 European markets and for consumers, who would have to pay additional product cost.” While these complications may seem minor, their implications hinder the free and cost-effective movement of goods in Europe, creating fragmentation and uncoordinated responses which would ultimately be detrimental to Europe’s competitiveness, its influence in a globalised economy and the wellbeing of its citizens. As Member States address matters in different ways and at different speeds, the Single Market may be at stake unless European solutions are in place. With this being said, national initiatives per sé are not to blame. But these initiatives should be kicked up and discussed at the European level, if we are to truly inherit their full potential. In this regard, a recent update of the European Parliament's "Cost of non-Europe" study estimates that the benefits of removing existing barriers in the Single Market for goods and services could amount to €713 billion by the end of 2029 [2]. Certainly not a disregardable number.

Freeing the paper tiger would help advance the ultimate emission reduction targets. The benefits of lifting Europe’s barriers go even beyond the economic factors. A well-functioning Single Market would in fact also bring us closer to the EU’s set decarbonisation objectives. Particularly, a circular economy is a critical tool which aids the unfolding of a successful green transition. With an increasing number of Member States drawing up rules to make products more sustainable, solutions must be applied at the European level as part of a broader harmonised approach. Deviating regional legislation risks in fact undermining the entire sustainability efforts as the EU attempts to move towards a more sustainable model. 

In February 2022, the European Commission presented its second annual report on the Single Market identifying ways to make it more resilient. Bold action is needed to preserve strategic value chains and secure the competitiveness of tomorrow’s industry.

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