Since the start of this year, Europe’s financial crisis has been given many labels - a sovereign debt crisis, a banking sector crisis, a crisis of the euro itself. But rarely is it asked whether the European Union’s single market, which is the foundation stone of EU integration in the modern era, is under serious threat.
One person who has asked this question is Mario Monti, the distinguished former EU commissioner for the internal market and competition policy. In May he presented a report on how to reinvigorate the single market to Commission president José Manuel Barroso, who had commissioned it from him last year. It delivered a blunt message. Many Europeans – citizens as well as political leaders – looked at the single market with “suspicion, fear and sometimes open hostility”, Monti said. “The single market today is less popular than ever, while Europe needs it more than ever.” Read more
It’s less than a week since General Motors agreed to sell Opel, its European arm, to a group led by Magna International of Canada, but already a wave of anger at the implications of the deal is building up. Nowhere is this more true than in Belgium and the UK, where workers at GM plants seem far more at risk than their colleagues in Germany of losing their jobs.
This episode is, however, about much more than potential job losses. It’s about Europe’s reluctance to come to terms with huge overcapacity in its car industry. It’s about how best to preserve a broad manufacturing base in an era when the other main recent driver of European economic growth - lightly regulated financial capitalism – is discredited. Finally, it is a test of the European Commission’s ability to uphold its strict rules on competition and state aid during the worst recession in the European Union’s history. Read more
What should be the top five priorities of the next European Commission?
1) Top of my list is the defence, and if possible the strengthening, of the single European market. This is the European Union’s bedrock achievement. It secures prosperity for its citizens, and it underpins the EU’s collective weight in the world. Without the single market, the EU would lose not merely its cohesion but its very reason for existence. The single market is under strain at present because of the emergency measures taken over the past year to prop up Europe’s banking system. These have, in effect, suspended the EU’s state aid rules in this sector. The Commission will need to be tough in making sure that EU governments do not manipulate the rules as the emergency measures are gradually withdrawn. Meanwhile, it should continue to press the case for integrating and liberalising the EU’s service sector, which accounts for two-thirds of all EU economic activity. Read more