This year EU’s Single Market will celebrate its 20th anniversary and at a meeting in the Competitiveness Council 30 May the Danish Minister for Business and Growth will try to get support for a number of growth initiatives in the Single Market Act.
Behind the scenes of the Single Market
The Single Market is very important to cooperation within the EU and for economic growth within the Member States. This has been the case since its establishment in 1992. The Single Market consists of the 27 EU Member States and the EFTA countries Norway, Lichtenstein and Iceland, which makes the Single Market the largest domestic market in the Western world.
The EU’s Single Market has made it possible for people, capital, goods and services to freely cross borders in the EU. This is achieved through the adoption of common legislation for the entire EU area. In this way citizens and companies need only understand one set of rules instead of having to know 27 different ones.
This means that a Danish company is able to sell nuts and bolts in Hamburg with the same ease as it would sell the same nuts and bolts in Denmark. Or that one’s education is recognised in other EU Member States, for instance allowing a Danish carpenter to cross the border to build a garage for a client in Germany without having to fulfil any additional educational requirements.
The Single Market to boost growth
The Single Market has had great impact. The development of the Single Market is responsible for an increased level of trade between the Member States in the EU. There are many different assessments of the magnitude of this increased trade across the borders, but a valid estimate is that the trade between the countries in the EEA has doubled as a consequence of the establishment of the Single Market.
For instance, the EU is the biggest export market for Danish companies – 75 % of all goods and 50 % of services are exported to other EU Member States and each year this amounts to around €47 billion for Danish companies. In addition, it is estimated that the total GDP of the EU has increased by 5 % due to the economic integration of the Single Market and 2.8 million extra jobs have been created between 1992 and 2009.
A check-up on the Single Market
Is the Single Market living up to its full potential or is there a need for a check-up? This is a question that has been put forward within the EU as a prelude to the celebration of the anniversary. In times of economic crisis this is even more relevant. The answer is both yes and no – we have come a long way in developing the Single Market, however there is still untapped potential.
In 2009 the European Commission asked the Italian professor Mario Monti, current Prime Minister in Italy, to review the Single Market and report on ways it could be improved. The report was finished in 2010 and formed the basis of the Commission’s communication the Single Market Act. The communication identifies twelve key initiatives to both create renewed growth in the EU and increase the trust of citizens and companies in the Single Market. It also suggested ways that the Single Market might better function and proposed strengthening of the Digital Single Market.
The main focus is on creating a transparent and well-functioning market that benefits consumers and companies, ensuring that they can enjoy the rights that the Single Market gives them. Even today, when most barriers to trade have been removed through the harmonisation and standardisation of legislation, companies and citizens can still experience barriers to their free movement from time to time.
Examples include national requirements eliminating companies from other Member States in participating in tenders in the Member State or the lack of mutual recognition of professional qualifications preventing EU citizens from working in other Member States. The EU – with the European Commission as the front runner – is determined to update and governance existing legislation to stamp out the last barriers to trade.
Another focus is to tap the growth potential in completing the Digital Single Market in the EU. In order to create a well-functioning Digital Single Market, public authorities in the Member States in the EU must share experiences on digital solutions with each other to a greater extent than is the case today. At the same time, it is a task for the EU to establish common rules for shopping on the internet.
The Single Market and the Danish EU Presidency
The relaunch of the Single Market and the strengthening of the Digital Single Market are important topics during the Danish EU Presidency during the first half of 2012. Among other things, the Danish Minister for Business and Growth has discussed the Digital Single Market with his European minister colleagues at an informal council meeting in Copenhagen in February.
Also, on behalf of the Council of Ministers, the Danish EU Presidency has entered into an agreement with the European Parliament to ensure lower prices for using mobile telephones and mobile internet when travelling within the EU.
On 30 May, the European ministers responsible for growth and competitiveness will meet at a formal council meeting in Brussels. As the Presidency of the Council of the European Union, the Danish Minister for Business and Growth will help ensure that the Single Market brings renewed growth through the initiatives in the Single Market Act.