BUSINESS/ECONOMY

Toward a unified Europe

PETER LEWIS June 6 1988
BUSINESS/ECONOMY

Toward a unified Europe

PETER LEWIS June 6 1988

Toward a unified Europe

The European Community’s drive to weld its 12 national markets into a single economy by 1992 has become an obsession in Western Europe. Corporations cite the date whenever they mount takeover bids, technocrats use it as a weapon to denounce inefficiency, and politicians say that it will put Europe on an equal economic footing with North America and Japan. This week the EC’s Council of Ministers will pave the way to integration when they meet in Luxembourg to sign an agreement to remove nearly all barriers to the free flow of goods, services and money in Europe. And the race to turn Europe into a vast trading bloc has galvanized some non-EC countries such as Turkey, which desperately wants into the EC before 1992. But the EC, which recently admitted the poor European nations of Spain and Portugal, is fearful of admitting Turkey—a militarily strategic but economically backward country.

In just four years the EC hopes to become the huge free trade bloc that was envisaged when the EC emerged from the Treaty of Rome in 1957. Three years ago Lord Cockfield, the 71-year-old Briton in charge of the EC’s barrier-flattening drive, identified nearly 300 obstacles that he said had to be removed before 1992. So far, only about 79 have been demolished, and another 10 or 15 will likely disappear in the next few months. Still, Cockfield says he is confident that in 1992 the EC will become “a community where traders do business in other member states as they now do in the next street or town.” Indeed, the EC may even introduce a common currency.

But the EC’s grand design will have to tiptoe through a minefield made up of its member nations’ parochial interests, political considerations and economic realities. But there are strong motives for forging a single European market. A major study published by the EC late last month determined that abolishing barriers would create five million new jobs. And those findings are clearly of interest to the Turkish government, which says that its economic future must be linked to the emerging European free trade bloc.

PETER LEWIS

in Brussels