Op-ed: Three ways the single market can boost efficiency for greater competitiveness

By overcoming fragmentation, increasing financial investment, and revising public procurement rules, Europe can strengthen its competitive edge and thrive in the global economy.
The proposed Circular Economy Act will create a market for refurbished and second-hand goods

By Anna Cavazzini MEP

Anna Cavazzini (DE, Greens/EFA) is the chair of Parliament’s Internal Market and Consumer Protection (IMCO) Committee

12 Nov 2024

@anna_cavazzini

In his recent report on the future of European competitiveness, Mario Draghi outlines clear requirements for ensuring the continuing prosperity of the European economy. The EU Green Deal, net-zero goals and the transition to a circular economy remain foundational but achieving them will require significant investments and a truly European industrial policy. 

The Committee on the Internal Market and Consumer Protection (IMCO) will take inspiration from the Draghi report, and Enrico Letta’s earlier report on the single market, to make concrete policy demands to the European Commission that will protect European businesses against geopolitical turbulence and sharpen their competitive edge on a global scale.  

Our common market rules have always been a driver of integration and a boost for our economy. We must now develop three core elements to work more closely together as a single market. First, we need to overcome the fragmentation that still exists, often caused by member states’ diverging interpretation of our common rules. Harmonisation is the number one way to diminish burdens for businesses active on the single market.  

Secondly, we need more financial capacity in the single market: a reform of the state aid rules giving much more prominence to cross-border projects, going hand in hand with new European money to invest coherently. And thirdly, it is high time for a revision of our public procurement rules to include sustainability and social criteria, unlocking European demand. 

In the last term, we used the strength of our internal market to foster the green and digital transitions with the Digital Services Act, Digital Markets Act and the AI Act. These set democratic rules to govern the online world, while bringing consumers on board in the transition with provisions such as the “right to repair.” 

In this term, we will monitor the implementation and enforcement of these rules to guarantee citizens their new rights as fast as possible and without restrictions. 

There is clearly more to be done. Consumers still face a massive power imbalance vis-à-vis big tech, which must be addressed with new regulation. The Commission’s proposed Digital Fairness Act should tackle “dark patterns” (techniques used by websites and apps to influence users into granting consent to being tracked, or having their data used in ways they didn’t expect) while plans for a Circular Economy Act should create a market for refurbished and second-hand products as well as secondary raw materials. This will make reuse and recycling the norm.   

Regulating online marketplaces will be another big task. The spread of e-commerce has exposed European consumers to vast quantities of low-quality products from outside countries, including through platforms such as Shein or Temu – and the trend is rapidly increasing. Often, they do not meet internal market standards for product safety, and in the event of damage or defects, consumers often have no redress with the manufacturers, typically based in China. 

With so many low-cost products being shipped individually, our customs and market surveillance officials are understandably overwhelmed and unable to guarantee that our standards are respected. With a major reform of the EU Customs Code in the legislative pipeline and the DSA now effective, first aid is on its way but will not be enough. In this term we will continue to fight unfair competition from outside countries. 

Read the most recent articles written by Anna Cavazzini MEP - Repairing the circle: Why consumers and companies benefit from a circular economy

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Economics