Europe's 'Single Market'

January 09, 1993

Several years ago, "Europe '92" was the hottest topic of economic futurists. What would happen when 12 markets became one, when an engineering design specification good in one country needed no change for the other 11, when a sausage meeting health standards in one met them in all, when people traveled from one to another without bothering to show papers?

Would U.S. business be ready for the challenge and the opportunity? The phrase Europe '92, the year in which all the bureaucratic changes would be accomplished, really meant '93, the first day of which all changes would be in effect. The target date had been set by the European Community Commission as a means of forcing the pace.

In the interim, distractions loomed. Eastern Europe broke free of Moscow and wanted to turn the Europe of 12 into 20 or so. The Soviet Union dissolved. Communist power vanished from Europe, leaving regimes claiming to be Communist in their monopoly of power only in China, North Korea, Vietnam and Cuba, with some concessions to capitalist economics in all save Cuba.

Germany unified, at enormous cost, bringing former East Germany quietly into the 12 though well below its standards. The world economy, and Europe's, slowed down, which was partly attributed to Germany's high interest rates needed to divert capital to rebuilding East Germany.

All of which rekindled nationalism in lesser or greater degree in most countries. The Maastricht Treaty to create a single monetary system for the 12 (or however more they become) is stalled short of unanimous ratification. Realizing that a single red-tape-free market was good for illegal immigrants, money laundering, crime and terrorism as well as business, several countries nullified the date for a passport-free Europe. Several, to bolster their own citizens' businesses, flagrantly violate the agreed rules in such matters as government procurement or banking regulation.

Nonetheless, much of the most tedious and least glamorous aspects of Europe '92 are in effect today in '93. It is more and more true that entry to the business of one of the 12 is entry to all, considerably more true than a year ago. Some nine of the 12 are planning to have a common visa by mid-year, the next-best thing to passport-free travel. What the world outside Europe is waiting to see is whether the rules of the single market, now adopted and officially implemented, will be enforced in courts.

The momentum to a single Europe has slowed down, but it is still momentum, and would be very hard to reverse.

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