Politics & Economics

A truly borderless Single Market: cooking with Enrico Letta

May 2024
By Editorial Staff

Following the presentation of his “Much more than a market” report at the last European Council, Enrico Letta is continuing his European tour to present Member States with his recipe for a stronger and more attractive Single Market, both externally and, more importantly, internally.

During the online conference “Revival of EU Single Market – Defining The Road Ahead” organized by Euractiv, Letta pointed out that competitiveness from the monolithic economic systems of the United States and China is challenging the EU’s ability to attract people and capital from outside. In Letta’s view, the fragmentation of the European market, consisting of 27 different tax and regulatory systems, frightens investors, obliged to maneuver through different bureaucracies and taxation.

The recipe set out in Letta’s report, therefore, seeks to align 27 national sovereignties with the European one through a “28th passepartout regime,” a single regulatory scheme “that can be used by companies to enter and invest in the EU with a single legal system, without changing from one country to another simplifying the procedures, and without eliminating the single commercial systems.”

In true TikTok cooking fashion, the ingredients of the recipe are what Enrico Letta called the “leftovers” of the Single Market. Those sectors were absent in the original idea, but are vital to today’s world: energy, telecom, and financial services, fields where the EU’s lack of attractiveness and competitiveness is strong. These three sectors, in Letta’s intention, give rise to three roadmaps on which national sovereignties can work together and develop new stimuli for competitiveness.

At the end of the “baking”, consisting of Letta’s relentless work in presenting his report to the Member States, this would result in a Single Market that once again puts citizens at the core, as in Jacques Delors’ original intention, and gives the freedom to businesses and people to innovate and research without artificial limitations.

Hence, Letta’s innovation in the Single Market of the future consists, in fact, of this “Fifth Freedom” which, if implemented, would make it possible not only to generate attractiveness from outside but above all to prevent the curse of the brain drain, which is depriving the European Union of its brightest talents.

And therein lies Letta’s final provocation. The purpose of the Fifth Freedom is to incentivize a “freedom to stay,” involving a Single Market capable of developing new pathways for investment in the Union’s most disadvantaged territories, and the new Cohesion Policy under development. The collation of these two areas can then enable the Union to experience a new glow without losing any more of those smart citizens that make it possible for the Single Market to thrive.