The strengthening of the Single European Market vs. the crisis

Abstract:The economic crisis that erupted in 2008 has significantly influenced the European Union (EU) economy and questions about the future of the European integration process have arisen. The crisis' effects forced the European Union institutions and its Member States to take significant decisions and to draft recovery plans. Apart from initiatives aimed at economic policy coordination and financial market supervision, the EU proposed and introduced important initiatives for the strengthening of the internal market's competitiveness. In November 2008 the European Commission in its communication on the EU recovery plan proposed ways for supporting the real economy and competitiveness, for boosting demand and for restoring confidence in the European economy. Then, over the years 2008-2011, a broad range of legislative and non-legislative decisions were taken by the European Commission and the European Parliament in order to minimize the crisis' consequences for the internal market, which included the Single Market Act and the new European strategy Europe 2020. Moreover, part of the EU budget was taken out for investments in energy security, the development of broad-band internet in the rural areas or enterprise help within the framework of the EU Cohesion Policy, while the European Investment Bank took out15 billion euros for credits and loans to SMEs.Taking into account the variety and the scope of these actions this article will focus on the initiatives aimed at strengthening the competitiveness of the EU internal market. The overall objective is to answer the three main questions:1. What are the priorities of the internal market and how can market competitiveness be improved in crisis circumstances?2. What are the main activities of the EU institutions (the European Commission and the European Parliament) to strengthen the functioning of the internal market and EU competitiveness during and after the crisis?3. What are the funding sources of actions relating to the internal market after the crisis?Keywords: economic crisis, internal market, European Union, competitiveness, EU institutions, EU budget, EU Multiannual Financial Perspective 2007-2013, Multiannual Financial Framework 2014-2020, Europe 2020 strategy, Single Market Act, international economics, European integration.JEL codes: F15, F20, F36, F42, F53, F59.IntroductionThe 2008 economic crisis had a global impact and considerably affected the Member States of the European Union. The results of the crisis are still visible and they have had their consequences on economic priorities set out at every level of economic governance, be it regional, national or European. The crisis has significantly influenced the priorities set and decisions made by the EU, both by intergovernmental institutions such as the European Council or the Council of the EU and by the Community institutions, i.e. the European Commission (EC) and the European Parliament (EP).Apart from making spectacular decisions concerning the coordination of economic policies and the enhancement of financial surveillance, it is especially important for the EU in the times of crisis to consider what actions should be taken under other Community policies and what legal, institutional and financial instruments should be used in order to strengthen the economy and streamline the functioning of the Single Market1. Therefore, three important issues are presented in this article concerning the functioning of the Single Market in crisis conditions and the actions taken by the EU in order to alleviate the negative effects and to prevent the occurrence of more of such economic collapses. The article is divided into three sections. The first section outlines major issues for and barriers to the internal market, elimination of which is of crucial importance to the economic development of the European Union after the crisis. The second section covers selected legislative and extra-legislative developments between 2008 and 201 1, related to the strengthening of the Single Market and the competitiveness of the EU in crisis conditions, with the twelve levers of the Single Market Act as the main focus. …