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Scenario 2: Nothing but the single market
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Domain: World
Definition
THE EUROPEAN UNION IS GRADUALLY RE-CENTRED ON THE SINGLE MARKET.
Why and how?
In a scenario where the EU27 cannot agree to do more in many policy areas, it increasingly focuses on deepening certain key aspects of the single market. There is no shared resolve to work more together in areas such as migration, security or defence.
As a result, the EU27 does not step up its work in most policy domains. Cooperation on new issues of common concern is often managed bilaterally. The EU27 also significantly reduces regulatory burden by withdrawing two existing pieces of legislation for every new initiative proposed.
By 2025, this means:
The functioning of the single market becomes the main “raison d’être” of the EU27. Further progress depends on the capacity to agree related policies and standards. This proves easier for the free movement of capital and of goods, which continues tariff-free, than it does in other areas.
Given the strong focus on reducing regulation at EU level, differences persist or increase in areas such as consumer, social and environmental standards, as well as in taxation and in the use of public subsidies. This creates a risk of a “race to the bottom”. It is also difficult to agree new common rules on the mobility of workers or for the access to regulated professions. As a result, the free movement of workers and services is not fully guaranteed.
The euro facilitates trade exchanges but growing divergence and limited cooperation are major sources of vulnerability. This puts at risk the integrity of the single currency and its capacity to respond to a new financial crisis.
There are more systematic checks of people at national borders due to insufficient cooperation on security and migration matters.
Internal disagreements on the approach to international trade mean the EU struggles to conclude deals with its partners. Migration and some foreign policy issues are increasingly left to bilateral cooperation. Humanitarian and development aid is dealt with nationally. The EU as a whole is no longer represented in a number of international fora as it fails to agree on a common position on issues of relevance to global partners such as climate change, fighting tax evasion, harnessing globalisation and promoting international trade.
Pros and cons:
The EU’s re-centred priorities mean that differences of views between Member States on new emerging issues often need to be solved bilaterally, on a case-by-case basis. Citizens’ rights derived from EU law may become restricted over time. Decision-making may be simpler to understand but the capacity to act collectively is limited. This may widen the gap between expectations and delivery at all levels.
Impact on policies
Single market & trade
Single market for goods and capital strengthened; standards continue to differ; free movement of people and services not fully guaranteed.
Economic & Monetary Union
Cooperation in the euro area is limited.
Schengen, migration & security
No single migration or asylum policy; further coordination on security dealt with bilaterally; internal border controls are more systematic.
Foreign policy & defence
Some foreign policy issues are increasingly dealt with bilaterally; defence cooperation remains as it is today.
EU budget
Refocused to finance essential functions needed for the single market.
Capacity to deliver
Decision-making may be easier to understand but capacity to act collectively is limited; issues of common concern often need to be solved bilaterally.
Illustrative snapshots
Why and how?
In a scenario where the EU27 cannot agree to do more in many policy areas, it increasingly focuses on deepening certain key aspects of the single market. There is no shared resolve to work more together in areas such as migration, security or defence.
As a result, the EU27 does not step up its work in most policy domains. Cooperation on new issues of common concern is often managed bilaterally. The EU27 also significantly reduces regulatory burden by withdrawing two existing pieces of legislation for every new initiative proposed.
By 2025, this means:
The functioning of the single market becomes the main “raison d’être” of the EU27. Further progress depends on the capacity to agree related policies and standards. This proves easier for the free movement of capital and of goods, which continues tariff-free, than it does in other areas.
Given the strong focus on reducing regulation at EU level, differences persist or increase in areas such as consumer, social and environmental standards, as well as in taxation and in the use of public subsidies. This creates a risk of a “race to the bottom”. It is also difficult to agree new common rules on the mobility of workers or for the access to regulated professions. As a result, the free movement of workers and services is not fully guaranteed.
The euro facilitates trade exchanges but growing divergence and limited cooperation are major sources of vulnerability. This puts at risk the integrity of the single currency and its capacity to respond to a new financial crisis.
There are more systematic checks of people at national borders due to insufficient cooperation on security and migration matters.
Internal disagreements on the approach to international trade mean the EU struggles to conclude deals with its partners. Migration and some foreign policy issues are increasingly left to bilateral cooperation. Humanitarian and development aid is dealt with nationally. The EU as a whole is no longer represented in a number of international fora as it fails to agree on a common position on issues of relevance to global partners such as climate change, fighting tax evasion, harnessing globalisation and promoting international trade.
Pros and cons:
The EU’s re-centred priorities mean that differences of views between Member States on new emerging issues often need to be solved bilaterally, on a case-by-case basis. Citizens’ rights derived from EU law may become restricted over time. Decision-making may be simpler to understand but the capacity to act collectively is limited. This may widen the gap between expectations and delivery at all levels.
Impact on policies
Single market & trade
Single market for goods and capital strengthened; standards continue to differ; free movement of people and services not fully guaranteed.
Economic & Monetary Union
Cooperation in the euro area is limited.
Schengen, migration & security
No single migration or asylum policy; further coordination on security dealt with bilaterally; internal border controls are more systematic.
Foreign policy & defence
Some foreign policy issues are increasingly dealt with bilaterally; defence cooperation remains as it is today.
EU budget
Refocused to finance essential functions needed for the single market.
Capacity to deliver
Decision-making may be easier to understand but capacity to act collectively is limited; issues of common concern often need to be solved bilaterally.
Illustrative snapshots
- Air quality differs greatly across Europe with some countries choosing to remove standards and regulations on harmful emissions. Water quality may differ along transnational rivers such as the Danube or the Rhine.
- Europeans are reluctant to use connected cars due to the absence of EU-wide rules and technical standards.
- Crossing internal borders for business or tourism is made difficult due to regular checks. Finding a job abroad is also harder and the transfer of pension rights to another Member State is not guaranteed. Those falling ill abroad face expensive medical bills.
- The EU27 fails to conclude new trade agreements as Member States are unable to agree on common priorities or some block ratification.
- Citizens in a country subject to airspace violations or large-scale cyber-attacks by a foreign power struggle to understand why sanctions are not agreed by the EU27 or even neighbouring countries.
- The renationalisation of development aid makes it harder to build comprehensive partnerships with African countries, limiting economic opportunities in a growing market and failing to tackle the root causes of migration.