Huge potential for growth in the EU’s internal market
Summary The EU’s internal market holds great untapped potential worth billions, which could make a vital contribution to stimulating growth in the European economy. A more offensive campaign to enhance the internal market by 2030 could give a permanent boost to Europe’s GDP of 5-8 percent. This is revealed in a review of a number of financial analyses conducted by Think Tank EUROPA based on extensive studies of existing economic literature on the effects of the internal market. The review shows that if more open trade and greater competition is encouraged in the internal market, the total financial gain will reach between 653 and 1,046 billion euro by 2030.
By carrying out a better and more consistent implementation of the EU rules and by opening up the internal market in areas such as services, digital technology, energy and transport, it could boost the European economy and in turn ensure better welfare and pave the way for new jobs.
Increasing trade and competition in the internal market will create a bigger and more long-term economic impact than the 315 billion euro Investment Plan European Commission President Jean-Claude Juncker launched on 26 November.
Think Tank EUROPA’s review of the financial analyses points to a number of areas in which a new wave of reforms in the internal market could give a much needed boost to the EU’s otherwise weak growth. Political leadership at national and EU levels will be crucial in securing support for the reforms.
It is important to communicate the value of reaching an agreement on the necessary reforms is communicated to the wider public, as an increasing proportion of the Danish population, like the rest of Europe, is in doubt over the benefits associated with the internal market and has concerns about welfare in light of the rule on free movement of workers. However, the shared European and economic benefits are so extensive that the politicians need to arrive at a mutual response to the social and economic challenges a stronger internal market will pose.
- The internal market has the potential to boost the EU’s GDP by 5-8 percent by 2030. The financial gain could reach between 653 and 1,046 billion euro.
- Several studies show that Denmark will reap the benefits from a stronger internal market. Estimates show that this could create between 77,000 and 124,000 new Danish jobs by 2030.
- This demand that the EU countries agree on a series of new reforms, whereby the internal market is extended to energy resources and digital technology. A more consistent and smoother implementation of the existing regulatory framework will also be essential.
- Implementing reforms to extend the internal market to cover energy, capital and digital technology, as the newly appointed European Commission has announced in its work plan, is a step in the right direction. But it is yet to be seen whether it can foster a political agreement between the European Parliament and the member states. It is therefore essential to have strong political leadership.
- Public support of the internal market has waned in Denmark and the rest of the EU. Therefore, it is crucial to reach a general consensus on new reform packages in the individual member states.