Brussels, 27 January 2011
Commission launches ambitious programme to deepen the Single Market for services
While services currently represent two-thirds of the EU's GDP and employment, they only make up for around one-fifth of total intra-EU trade. Today, only about 8% of European SMEs do business in other Member States. This lack of dynamism not only hampers choice for consumers, but also prevents small and innovative businesses to grow, develop their activities and become more competitive. To unlock this potential of the Single Market for services by 2012, the European Commission has today adopted a set of targeted actions to tackle remaining problems. The Services Directive aims precisely at removing unnecessary and burdensome obstacles to trade in services in the Single Market. One year after the implementation deadline, the Commission and the Member States have completed an assessment of how the Directive has been implemented on the ground. The results of this so-called "mutual evaluation" exercise conclude that, while much has been achieved so far, the Single Market for services is not yet delivering its full potential. .
Michel Barnier, Commissioner for Internal Market and Services said: "In the present times of crisis, we need to unlock the further potential for growth that exists in an integrated Single Market for services. This will help businesses grow, innovate and create more jobs. This will also provide for better and more competitive services to EU consumers and businesses alike.
Targeted actions to strengthen EU services markets
The Services Directive was a major step forward, but work remains to be done to make EU services markets work better. The Communication "Towards a Single Market Act – (IP/10/1390) for a highly competitive social market economy", adopted on 27 October 2010 stated that the gains from a better functioning Single Market for services are estimated at annual profits of €60 to €140 billion, a growth of GDP of between 0.6 and 1.5%. While services currently represent two-thirds of the EU's GDP and employment, they only account for around one-fifth of total intra-EU trade. Today, only about 8% of European SMEs do business in other Member States. This lack of dynamism not only hampers choice for consumers, but also prevents small and innovative businesses from developing their activities and growing further.
In response, the Commission has outlined the following actions:
The Services Directive is an EU law that came into force with the aim of removing unnecessary and burdensome obstacles to the provision of services across the EU. Services represent +/- 66% of EU GDP. The Services Directive is a horizontal law covering a large variety of services representing around 40% of EU GDP and employment. The Directive required Member States, by the end of 2009, to simplify their administrative procedures and establish "Points of Single Contact" to allow businesses to more easily process paperwork electronically. In order to take stock of the progress made and identify remaining gaps, the Directive foresaw a "mutual evaluation" process that was carried out in 2010. This was an innovative and evidence-based exercise of "peer review" in which the Member States and the Commission examined together the main results of the implementation of the Services Directive.
A dynamic EU services sector is a key priority for the Commission. Services are the driving force of the EU economy and around nine out of ten jobs are created in this sector. As identified in the Commission's Annual Growth Survey (see IP/11/22), the EU will only meet its ambitious Europe 2020 targets for sustainable and inclusive growth if urgent structural reforms are prioritised in services and product markets to improve the business environment.
See also MEMO/11/49.