The single market remains the decisive power of the EU. CEPS Policy Priorities for 2019-2024, 18 October 2019

The EU’s single market should not just be one among several priorities for the new Commission and Parliament. The single market was and is the core business of the EU. Much of what goes on or is proposed under elaborate titles is actually part and parcel of the single market. The striking revelation of Brexit for many EU citizens and all businesses is precisely the centrality of the single market (including the customs union) to EU membership. Its value is first of all economic, of course, as it yields higher prosperity. However, it is critical in other arenas where ‘EU clout’ derived from the single market matters, such as multilateral and bilateral trade negotiations, global climate deals, standard setting, rule-making for international financial stability and even foreign policy

Economic Implications of Enlargement. Bruges European Economic Policy (BEEP) Briefing 1/2002

The Eastern enlargement is about to be decided by the European Council. As expected, the “end game “ of the negotiations and assessments is heavily biased by a narrow perspective on net transfers, on income compensations to Central European farmers and on the psychological politics of a single “big bang “. None of these three so-called key items of the end game are of much relevance to appreciate the significance of enlargement. Net transfers have little to do with the costs and benefits of club membership for countries which pay, and can lead to addiction and lethargy rather than extra growth if market integration, macro-economic stability and domestic reforms are not taken serious (as the case of Greece before 1997 has demonstrated). Income compensations for Eastern farmers are crucial for this pressure group, and symbolically of some importance in domestic politics because of the perversity that rich farmers get more, but their absence is likely to serve the public interest in candidate countries far better. And being part of the big bang, as against getting in one or three years later, has assumed a dramatic meaning during this end game, far beyond its true proportions. This hectic European theatre tends to obscure what enlargement is mainly about, now that the stability and values have been secured for the peoples from Central Europe. In a guaranteed setting of peace, freedom and security, enlargement is about greater prosperity

How Social is European Integration? Bruges European Economic Policy (BEEP) Briefing 18/2007

The social dimension of the internal market or of the EU more generally has recently been under quite fundamental attack. Calls for 'Europe' to be 'more social' have been heard repeatedly. Witness the polarized debates about the services directive, the anxieties concerning several ECJ cases about what limitations of the free movement of workers (posted or not) are justified or the assertion of a 'neo-liberal agenda' in Brussels disregarding or eroding the social dimension. This BEEP Briefing paper takes an analytical approach to these issues and to the possible 'framing' involved. Such an analysis reveals a very different picture than the negative framing in such debates has it: there is nothing particular 'a-social' about the internal market or the EU at large. This overall conclusion is reached following five steps. First, several 'preliminaries' of the social dimension have to be kept in mind (including the two-tier regulatory & expenditure structure of what is too loosely called 'social Europe' ) and this is only too rarely done or at best in partial, hence misleading, ways. Second, the social acquis at EU and Member States' levels is spelled out, broken down into four aspects (social spending; labour market regulation; industrial relations; free movements & establishment). Assessing the EU acquis in the light of the two levels of powers shows clearly that it is the combination of the two levels which matters. Member States and e.g. labour unions do not want the EU level to become deeply involved ( with some exceptions) and the actual impact of free movement and establishment is throttled by far-reaching host-country control and the requirement of a 'high level of social protection' in the treaty. Third, six anxieties about the social dimension of the internal market are discussed and few arguments are found which are attributable to the EU or its weakening social dimension. Fourth, another six anxieties are discussed emerging from the socio-economic context of the social dimension of the EU at large. The analysis demonstrates that, even if these anxieties ought to be taken serious, the EU is hardly or not the culprit. Fifth, all this is complemented by a number of other facts or arguments strengthening the case that the EU social dimension is fine

Just a little Brexit?: ‘Alternative (customs) arrangements’ and the Withdrawal Agreement. CEPS Policy Insights No 2019-13/ September 2019

With the five-week closure of the UK Parliament, the highly entertaining sessions of the House of Commons have been adjourned. Could this artificial breathing space provide a realistic opportunity to deliver the now infamous ‘alternative customs arrangements’, making the backstop unnecessary? And without the backstop, could the Withdrawal Agreement be ratified soon, opening at long last the way to genuine negotiations about the treaty on the future relations between the UK and the EU-27 (based on the Political Declaration, a kind of MoU on these negotiations)

Shattered Illusions: The new Brexit proposals on customs. CEPS Commentary, 17 July 2018

With just five months to go, allowing three for ratification, what will the post-Brexit EU/UK relationship look like? On the colossal matter of post-Brexit arrangements, almost nothing has been agreed except the avoidance mechanism of 21 months of status-quo during the ‘transition period’ beginning late March 2019. And we are no closer to an answer to the most unnerving question: without any workable ‘deal’ on customs, will ports grind to a halt, generating gigantic queues of lorries? As recently as one month ago, a House of Lords report[1] still discussed the delusional UK customs proposals of August 2017 that had already been rejected by EU negotiators. The cliff-edge looms large over the UK government, the EU and business on both sides

Pre-empting technical barriers in the Single Market. CEPS Policy Brief No. 277, 11 July 2012

Effective enforcement and compliance with EU law is not just a legal necessity, it is also of economic interest since the potential of the Single Market will be fully exploited. Enforcement barriers generate unjustified costs and hindrances or uncertainty for cross-border business and might deprive consumers from receiving the full benefit of greater choice and/or cheaper offers. The EU has developed several types of enforcement efforts (preventive initiatives, pre-infringement initiatives and formal infringement procedures). More recently, the emphasis has been placed on effective prevention. This CEPS Policy Brief analyses the functioning of one preventive mechanism (the 98/34 Directive) and assesses its potential to detect and prevent technical or other barriers in the course of the last 25 years. Based on an empirical approach, it shows that this amazing mechanism has successfully prevented thousands of new technical barriers from arising in the internal goods market

New Asia-Pacific trade deal: Implications for East Asia and the EU. CEPS Policy Contribution 23 Nov 2020.

The conclusion of a new overarching Regional Comprehensive Economic Partnership (RCEP) Free Trade Agreement (FTA) between 15 Asia-Pacific countries has been celebrated across the globe. Its signatories are the 10 members of the Association of Southeast Asian Nations (ASEAN) countries and Japan, Korea, China, Australia and New Zealand; India withdrew from the agreement at the last moment. The signing of the RCEP is certainly good news for world trade and investment. It brings together a group of countries representing 30% of the global population and generating 29% of its GDP. It aims to facilitate and solidify global value chains; accept opening-up in terms of tariffs (while aiming to discipline non-tariff barriers); build a legal framework for services, trade, and investment; and address e-commerce issues such as the commitment not to impose data localisation. Much like the EU-Canada Comprehensive Economic and Trade Agreement (CETA), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) (an FTA between 11 APEC countries, without the US), and the EU/Japan Economic Partnership Agreement (EPA), the RCEP demonstrates once again that the US under the Trump administration was effectively alone in its attempts to disrupt further globalisation. Nevertheless, the RCEP is not a deep FTA and stipulates slow liberalisation over long periods of time, among its other peculiarities. It may also impact East Asian regionalism in the long term. This paper explains the Association of Southeast Asian Nations (ASEAN)-led origin of the RCEP in the context of APEC, summarises the substance of the agreement, and gives an inevitably crude first estimate of its impact on trade and overall income, as well as its structural implications. It concludes with reflections on the possible long-term implications of the RCEP for East Asian regionalism, for world trade and investment, and for the European Union

European Industrial Policy. Bruges European Economic Policy (BEEP) Briefing 15/2006

This survey of European industrial policy aims to set out and explain the great significance of European integration in determining (changes in) structure and performance of industry in the EU. This influence is explored from the policy side by analysing the transformation of the framework within which both EU and Member States' industrial policy can be pursued. Empirical economic analysis is not included because this BEEP Briefing was originally written for a handbook3 in which other authors were assigned a range of industrial economics subjects. In the last 25 years or so, the transformation is such that the nature and scope of industrial policy at both levels of government has profoundly changed as well. Indeed, the toolkit of measures has shrunk considerably, disciplines have been tightened and the economic policy views behind industrial policy have altered everywhere. The pro-competitive logic of deeper market integration itself is rarely questioned nowadays and industrial policy at the two levels takes on different forms. The survey discusses at some length the division of powers between, and the complementarity of, the Member States' and EU levels of government when it comes to industrial policy, based on a fairly detailed classification of industrial policy instruments. The three building blocks of the wide concept of industrial policy as defined in this BEEP Briefing consist of the EU framework of market integration, EU horizontal industrial policy and its EU sectoral or specific counterpart. Each one is surveyed at the EU level. Preceding these three sections is a discussion of three cross-cutting issues, namely, the indiscriminate use of the 'competitiveness' label in the EU circuit of business and policy makers, the relation between services and EU industrial policy and, finally, that of European infrastructure. One major conclusion is that, today, the incentive structure for industry and industrial markets is dominated by the stringency of the overall EU framework and to some moderate degree by the horizontal approach

Designing a Genuine EMU: Which "Unions" for EU and Eurozone? Bruges European Economic Policy (BEEP) Briefing 34/2014

The initial ‘framing’ (in the summer of 2012) of the ‘genuine EMU’ for the wider public suggested to design an entire series of ‘unions’. So many ‘unions’ are neither necessary nor desirable – only some are and their design matters. The paper critically discusses first the negative fall-out of the crisis for EMU, and subsequently assesses the fiscal and the banking unions as accomplished so far, without going into highly specific technical details. The assessment is moderately positive, although there is ample scope for further improvement and a risk for short-term turbulence once the ECB has finished its tests and reviews. What about the parade of other ’unions’ such as economic union, social union and political union? The macro-economic imbalances procedure (MIP) and possibly the ESRB have overcome the pre-crisis disregard of macro competitiveness. The three components of ‘economic union’ (single market, economic policy coordination and budgetary disciplines) have all been strengthened. The last two ‘unions’, on the other hand, would imply a fundamental change in the conferral of powers to the EU/ Eurozone, with drastic and possibly very serious long-run implications, including a break-up of the Union, if such proposals would be pushed through. The cure is worse than the disease. Whereas social union is perhaps easier to dismiss as a ‘misfit’ in the EU, the recent popularity of suggesting a ‘political union’ is seen as worrisome. Probably, nobody knows what a ‘political union’ is, or, at best, it is a highly elastic notion: it might be thought necessary for reasons of domestic economic reforms in EU countries, for a larger common budget, for some EU tax power, for (greater) risk pooling, for ‘symmetric’ macro-economic adjustment and for some ultimate control of the ECB in times of crisis. Taking each one of these arguments separately, a range of more typical EU solutions might be found without suggesting a ‘political union’. Just as ‘fiscal capacity’ was long an all-or-nothing taboo for shifting bank resolution to the EU level, now solved with a modest common Fund and carefully confined but centralised powers, the author suggests that other carefully targeted responses can be designed for the various aspects where seen as indispensable, including the political say of a lender-of-last-resort function of the ECB. Hence, neither a social nor a political union worthy of the name ought to be pursued. Yet, political legitimacy matters, both with national parliaments and the grassroots. National parliaments will have to play a larger role