Single European Market - Essay Example

On December, 31st, 2007 the Single European Market has celebrated its fifteenth anniversary. The age is not so significant by historical measurements, and nevertheless the most courageous forecasts of the development of the European integration, which had been made in the beginning of 1990s, had met the expectations. The Single Market today is an attractive and rather transparent environment for business and that is why during last fifteen years it has increased more than by one third. Owing to the unity of the market, the conditions of life in Western and Central European countries have notably approached. The Single Market is the European variant of the answer to the economic and technological challenges of the twenty first century and a basis for successful monetary and political integration. As a matter of fact the European Union has reached more than all the other integration groupings. Some of such groupings consider the European model as an example for imitation. Mutual opening of markets is not an easy task even for the safe and economically developed Europe. The idea to create a space without internal borders, comparable in the sizes with the USA market, has come more than fifty more years ago. And perhaps only the first step was rather unproblematic for the countries of the European community: the European Customs Union has been constructed in 1968 even before the planned term. But then they have to wait for almost twenty years for preconditions of completion of the Single Market formation. In 1985 the European Commission under the direction of Jacques Delors has issued the White Paper, a plan of elimination of internal protectionist barriers (physical, technical and tax) on the way of free movement of the goods, services, capitals and people. "Unifying this market (of 320 million) presupposes that Member States will agree on the abolition of barriers of all kinds, harmonisation of rules approximation of legislation and tax structures, strengthening of monetary cooperation and the necessary flanking measures to encourage European firms to work together" (Commission of the European Communities, 1985). Proposals of the White Paper have turned out in the development of 282 regulations and directives, most of which has been accepted by December, 31st, 1992, that is to the official date of the Single Market formation completion. But the basis, which has been constructed, represented only a good skeleton for so-called "four freedoms". Construction of the Single Market proceeded. The EU institutions consistently revealed and eliminated loopholes in the national law and practice doing all possible to prevent any opportunity of state and corporate protectionism. Today the Single Market is already governed by more than 1500 directives and 400 regulations. The EU law-making has concerned with the newest goods and services, which mass distribution could not been predicted in 1980s. And it seems like there's no bottom to it. Most likely the construction of the Single Market will be conducted without a breach of continuity. While one set of tasks moves forward, the other one even more complex will certainly appear. According to the official reports (EUROPEAN COMMISSION, 2004) of the beginning of the decade, positive influence of the Single Market on economy of the member-states began to fade on a number of parameters. Therefore the fifth, the most arrogant expansion of the European Union of 2004 has been called to recover dynamics of economic parameters. And indeed in the process of the Single Market expansion on the East export-import opportunities of the EU were strengthened. For the period of 1992 -2005 the parameter of foreign trade has increased from 6.9 per cent up to 12.3 per cent of cumulative gross domestic product (GDP). Realization of the other project, the economic and currency union has made the freedom of movement of capitals full-fledged. Owing to active lawmaking during last seven years the price of trans-boundary transfers has fallen from 17 - 25 euro for each one hundred up to 2.5 euro. Recent activity of EU institutions in liberalization of transport services sphere has allowed depressing the cost of air tickets and air-transportations more than on 40 per cent in comparison with the beginning of 1990s. Moreover the quantity of flights between the member-states of the EU has as much increased. Now it is much easier for the EU citizens to begin or buy business, than in 1990s. For this purposes are created special bodies incorporated in the Enterprise Europe Network - EEN. Owing to the establishment in 2001 of new status unit of the "European company", mergers and acquisitions are greatly simplified. There are already about 90 companies in the EU are called European. Today the EU finances the other world much more than it (the world) finances the EU. And in fact in 1996 the Commission in the first report on the Single Market with satisfaction wrote about the strengthening of attractiveness of the Single Market space for investments from the third countries. In the beginning of 1990s the EU-15 engrossed about 45 per cent of world foreign direct investment (FDI), whereas in the middle of 1980s less than 30 per cent. Nowadays conditions of getting to the Single Market space for investors from the third countries became too rigid. As for the benefits, which got the population of the member-states in result of creation of the Single Market, approximately three quarters of people mark the depreciation and improvement of quality of the mass-consumption products. Transition to the uniform currency has provoked a new wave of price competition, in fact now it is even much easier to consumers to compare prices. Today in the most of old EU countries there is almost no distinction in retail prices for foodstuffs, as for clothes, footwear and accessories the distinction in general have disappeared. Owing to the increased competition, there was a significant decrease in telecommunication rates (increase of more than 50 per cent as compared to the level of 1998). In the countries with the liberalized electrical energy market consumers pay for electricity of 15 per cent less, than in the countries with rather closed market. Overwhelming majority of citizens of the EU have no desire to go to other states of the Single Market to get some goods or financial services as the goods and services come on their national markets. As a matter of fact the freer become inter-country movement of goods, services and capitals, the fewer reasons remain for citizens of EU to change the place of residence within the space of the uniform market. The point is that beside positive aspects the data of reports and polls allocate many negative parameters and facts. So, among the reasons of extremely low mobility of the population are bad chances to find a job and also persisting unfavourable attitude of national authorities and potential employers to foreigners, even if they are citizens of the EU (EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, 2001). In the report, which has been made by the decade of the Single Market (EUROPEAN COMMISSION, 2002) in particular it is stated that the Single Market has already helped to create 2.5 million workplaces. But the aggregate number of unemployed people of the EU is seven times more. According to the European Commission, owing to the imperfection of the Single Market legislation in the sphere of protection of intellectual property more than 17 000 lawful workplaces are lost annually because of commercial piracy and forgeries; 37 per cent of the software used in the EU still are piracy, 22 per cent of sales of clothes and footwear it is necessary on the counterfeit goods (EUROPEAN COMMISSION, 2004: 19). The opinion poll in 2006 (EUROPEAN COMMISSION, 2006) has shown that there is more than half of companies now do not export to other member-states of the EU. About 5 per cent of heads of the companies-introverts of the countries-beginners have declared that on trying to sell their production to neighbours in the Single Market they have met insuperable difficulties; 4 per cent are concerned with unexpected barriers; 6 per cent do not see preconditions for export, and 6 per cent are not assured yet of own forces. 13 per cent of heads of not exporting companies of the old resident countries approved that they would like to trade abroad, but worry about possible barriers, 11 per cent stated they would like to get more information. As a whole, 80 per cent of heads of both exporting companies and companies-introverts have declared the necessity of the establishment of additional guarantees of fair competition, and priority of the general rules above the rules for each separate case. According to the Eurobarometer reports in 2006 (EUROPEAN COMMISSION, 2006, available at http://ec.europa.eu/public_opinion/archives/flash_arch_en.htm) the Scandinavian states: Denmark, Finland, and Sweden and the country-beginner Czech Republic more often express the satisfaction with the Single Market. The Austrians and the Frenchmen on the contrary more often express sceptic opinion. They are satisfied neither with assortment, nor with prices, neither with quality of goods and services, nor with many other new arrangements. In seven countries: Cyprus, Austria, Malta, Greece, Belgium, France and Germany a quarter of citizens see mobility of labour in a negative light. The Austrians in particular are concerned about constantly growing quantity of German youth in educational institutions of Austria. Approximately as many Greeks and Austrians consider that the opportunity of sale of other member-states production on equal terms with production of internal manufacture conceals in itself negative consequences for the national economy. The reasons of such unpleasant results for the EU institutes are obvious: it is uncertainty, weak knowledge of opportunities and the rights, and also still low probability of protection of these rights. Thus, it is obvious that for some participants of the Single Market its potential remains in many respects non-realized because of illegal practice and/or not eliminated loopholes in the legislation. The overall task aimed to solve the problem of Single Market potential realization assumes different quality of efforts. For the EU institutions it is infinite routine lawmaking and hard work on monitoring and evaluation. For the member-states it is a duty of regular approximation of the national legislation with the EU legislation. For economic operators it is a necessity of constant increase of the level of knowledge concerning legislative innovations. The level of awareness of society and business about the rights and duties in the single market remains low. According to opinion polls (EUROPEAN COMMISSION, 2006, available at http://ec.europa.eu/public_opinion/archives/flash_arch_en.htm) 49 per cent of citizens of the EU still think that they need a permit for placement in the neighbour-states in the Single Market; only 29 per cent know that they have the right to vote on local elections and elections in European Parliament living in other member-state; 73 percent of respondents in Luxembourg, 68 per cent in Belgium and 64 per cent in Denmark do not know that buying a car in other member-state they pay the VAT only once; in 8 of 25 countries participated in opinion poll more than 40 per cent of respondents are not informed whether the guarantee on goods bought in other country of the Single Market is kept. Approximately half of firms as testifies the poll are hardly aware of their rights in the Single Market. 14 per cent top managers of companies have declared that they do not employ the personnel from other member-states, as do not know how to search and employ such staff and whether it is possible to trust their diplomas. In the end 2001 it has been created the network named SOLVIT aimed to resolve problems and conflicts on the Single Market space. Today the network has 28 centres and exists on a gratuitous basis. It has two purposes: to reduce the quantity of judicial recourses; and for those, for whom suits are beyond their power to find fast (till 10 weeks) way of resolving problems arising in connection with non-application of the Single Market norms. Recently has come to the end the formation of an information portal, which units existing information programs and bases, such as SOLVIT, Dialogue with Citizens, the European Consumer Centres, Fin-net, EEJ-Net. There is also a direct number (0080067891011), on which businessmen and simple citizens can communicate with Europe Direct, a service to help find answers to questions about the European Union in general, and the Single Market in particular (EUROPEAN COMMISSION, 2003). Nevertheless, opinion palls show bad awareness of ordinary citizens of the listed institutions. The majority of respondents consider that in case of infringement of their rights it is necessary to search help at authorities of own country. From the date of the official declaration of four freedoms the law of the Single Market and the national law of the member-states have swelled so much that for some part of economic operators they represent just a difficult to comprehend accumulation of norms. Some norms are directed on revealing of exceptions from the main principles of the Single Market, the other, on the contrary, directed on removal of obstacles for direct application of these principles. The third ones notwithstanding they are accepted with the good purpose to increase safety and standards of life of citizens in practice reduce potential of their economic activity and physical mobility. There is an impression that the ideologists of the Single Market sitting in the European Commission are not assured themselves what is primarily: the rules or exceptions to the rules. A lot of innovations seem to be basically senseless as in fact they represent an upgrade of already existing principles and norms. And nevertheless, developers of the next directives know what they are doing as "four freedoms" of the Single Market after fifteen years of its functioning nevertheless today become reality. Works cited: 1. COMMISSION OF THE EUROPEAN COMMUNITIES. (1985). Completing the internal market: white paper from the Commission to the European Council. Brussels, The Commission. 2. EUROPEAN ECONOMIC AND SOCIAL COMMITTEE. (2001). Opinion of the Economic and Social Committee on freedom of movement for workers in the single market (Single Market Observatory), (own-initiative opinion). ESC opinions and reports, CES (2001) 406. Luxembourg, Office for Official Publications of the European Communities. 3. EUROPEAN COMMISSION. (2002). The internal market 10 years without frontiers. Brussels, European Commission]. http://europa.eu.int/comm/internal%5Fmarket/10years/docs/workingdoc/workingdoc%5Fen.pdf. 4. EUROPEAN COMMISSION. (2003). Overview of the implementation of rural development policy in the programming period 2000-2006: some facts and figures. 5. EUROPEAN COMMISSION. (2004). Internal market strategy priorities 2003-2006. Luxembourg, Office for Official Publications of the European Communities. 6. EUROPEAN COMMISSION. (2004). First report on the implementation of the Internal Market Strategy 2003-2006. Employment & social affairs. Luxembourg, Office for Official Publications of the European Communities. 7. EUROPEAN COMMISSION. (2006). Internal Market: Opinions and experiences of Businesses in the 10 New Member States. Eurobarometer. Report. 2006. Flash EB 190 http://ec.europa.eu/public_opinion/flash/fl190_en.pdf. 8. EUROPEAN COMMISSION. (2006). Internal Market: Opinions and experiences of Businesses in EU-15. Eurobarometer. Report 2006. Flash EB 180 http://ec.europa.eu/public_opinion/flash/fl180_en.pdf. Read More