Boosting productivity through a more integrated Single Market

The Single Market is one of the foundational elements of the European union, as well as its greatest economic asset. However, its potential remains heavily constrained by fragmentation, regulatory complexity and persistent barriers to cross-border trade. In the face of intensifying geopolitical tensions and trade disruption, the status quo is no longer an option. We are in a race against time. Deeper integration of the Single Market is not merely a goal; it is a prerequisite for boosting our productivity and securing the EU’s position in global economy. 

The EESC Opinion on "Boosting productivity through a more integrated Single Market", identifies simplification as a priority, but we must shift from strategies to immediate delivery. The pace of regulatory change must match the speed of development in global competition. 

Simplification and Monitoring

Whilst the stride towards simplification has demonstrated dedication to strengthening the Single Market, it is imperative that the results be measured through clearly defined performance indicators and benchmarking measures, fully integrated into European Semester framework. The EU needs a “delivery first” mindset. By defining targets member states would be provided with clear strategic direction. Additionally, to ensure timely implementation of commitments, it is imperative to set clear and realistic deadlines. 

Further integration of services is essential, given their growth potential and persistent barriers created by divergent national legislation. Building on that, the EU should also address “gold-plating”, where additional national requirements create unnecessary fragmentation beyond EU legislation.

We strongly support the full application of the once-only principle, with standardised data requirements, interoperable systems and automated data exchange so companies, particularly SMEs, are not repeatedly required to provide the same documentation to different authorities.

Digitalisation should reinforce this objective. The European Business Wallet should provide a single, secure interface for businesses, interoperable with existing national systems and registers rather than creating parallel structures. However, it should be stated that digital tools should reduce compliance costs, not shift disproportionate technical and financial burdens on to companies.

Scaling, productivity and Industrial Policy 

The Single Market was built to enable growth, yet administrative burdens continue to trap companies within national borders. Instead of facilitating cross-border trade and enabling businesses to operate across the European Union, administration, divergent national rules and administrative burdens continue to prevent companies from fully exploiting its potential, demonstrating that the Single Market remains far from fully integrated. 

Productivity is the primary driver of our global competitiveness. To scale, SMEs and scale-ups require predictable rules and a legal framework that facilitates, rather than hinders, expansion. 

Due to that, we advocate for an active industrial policy with “Made in EU” provisions that prevent the fragmentation caused by unilateral Member State policies. WE must ensure state aid rules create a level playing field, not a race to the bottom. Furthermore, we must integrate capital markets; the Savings and Investment union to close the financing gap and mobilize investment in innovation and productive capacity. 

Skills: the human factor of productivity

Productivity relies on the accessibility of skilled workforce. Recognition processes of professional qualifications should become faster, simpler and fully digital, with greater use of automatic recognition where appropriate. Skills portability must evolve to cover micro-credentials and work-based training, not only formal qualifications. Sector-specific approaches can help address shortages while supporting more effective European recognition systems. We cannot afford to let talent go to waste due to outdated requirements and administrative hurdles.

28th regime /EU Inc.

The 28th regime/EU Inc. holds an immense potential to enable companies to unify the legal environment for business of all sizes. We support this proposal provided it remains a simple, fully digital, and optional legal form available to companies of all sizes and sectors. 

However, we need to clearly demonstrate the added value of EU Inc. for companies for the adoption to be swift and widespread.

Conclusion

The Single Market cannot deliver on its promise while businesses continue to face fragmented rules, regulatory barriers, and unnecessary administrative burdens. Incremental change is insufficient. We must achieve genuine, socially responsible integration, that allows companies to scale, invest, access skills, and compete. 

We urge the swift implementation of measures set out in Enrico Letta’s report in “Much more than a market” with the emphasis on fully completing the integration of the Single Market, including the inclusion of financial markets. Only by acting together by the principle of the “Fifth freedom” (knowledge, research and innovation) we can ensure Europe’s long-term competitiveness and social cohesion. The implementation of these reforms is the ultimate test of the European Union’s credibility.

We must deliver, and we must deliver NOW.

By Marina ROŽIĆ, EESC Employers' Group member and Study Group member of Opinion INT/1121 Boosting productivity through a more integrated Single Market.