Putting the European Single Market on a path to sustainability

The European single market is one of the best tools available to us in the drive to creating a genuine circular economy, explains Arba Kokalari.

By Arba Kokalari

Arba Kokalari (SE, EPP) is shadow rapporteur for the European Parliament's 'Towards a more sustainable single market for business and consumers' report.

23 Nov 2020

To reduce emissions, resource consumption and waste, European legislators must eliminate obstacles for businesses seeking to become circular and make it easier for consumers to shop sustainably. Using the internal market as a tool to implement effective policies that facilitate this transition, rather than opting for bans and restrictions, is the solution.

Realising the full potential of the Green Deal, meeting climate targets and preserving the environment for the next generation are our most important responsibilities as European legislators today and in the future. Clearly, this is also a priority for European citizens and businesses.

The European Parliament has a historically strong mandate to combat climate change, and we should use it wisely. The internal market, the core of the European Union, is one of our best tools for driving the transition to a circular economy.

Across Europe, there are inspiring examples of sustainable innovation, new green technologies and circular business models. In the Swedish project ‘Hybrit’, three companies - in collaboration with politicians and academia - have developed a technology for producing fossil-free steel. This is a game changer for an industry with a long history of fossil fuel dependence.

“By increasing harmonisation and enforcement of legislation and facilitating standardisation, we can encourage and amplify business models that turn trash into treasure”

At the same time, creative start-ups are finding ways to minimise food waste and make second-hand, recycled and rented fashion mainstream. Unfortunately, obstacles remain that prevent circular and sustainable businesses from realising their full potential.

One example is the internal market for secondary raw materials. Since these materials have historically been considered waste, rather than an asset, the internal market for them is highly fragmented. By increasing harmonisation and enforcement of legislation and facilitating standardisation, we can encourage and amplify business models that turn trash into treasure.

Another area of untapped potential is the internal market for services. Heavy consumption of unsustainable, often single-use, products in today’s society creates environmental problems. The key to cutting emissions and reducing resource consumption and waste, while achieving economic growth and high quality of life, is to switch to more sustainable consumption. Here, the service sector plays a crucial role.

European consumers can contribute to the economy more sustainably by repairing, renting, sharing and buying experiences enabled by services. However, the internal market for services is still far from complete, primarily as a result of protectionist attitudes and misconceptions.

By completing the internal market for services once and for all, European leaders and policymakers would bring benefits for both consumers and businesses and contribute to a better climate and environment for future generations.

A final example of a measure for achieving a sustainable single market is to improve consumer information. Currently, there is a jungle of different labels and green claims, making it difficult for the consumer to decide what to purchase and who to believe when making sustainable choices. Some of these claims are simply false. Therefore, it is good that the European Commission is planning to introduce new measures to tackle misleading claims and rid the European market of these destructive practises.

In addition, it is important to harmonise, simplify and improve existing labels. From a political perspective, it is easy to call for new mandatory labels with more information. However, these risk doing more harm than good, shifting the burden to European businesses while adding to the existing information overload and increasing confusion.

Rather, politicians must work with industry, academia and civil society to improve existing tools such as the European eco-label. The negotiations in the European Parliament over the own-initiative report “Towards a more sustainable single market for business and consumers” have been tough.

“The internal market, the core of the European Union, is one of our best tools to drive the transition to a circular economy”

As the EPP shadow rapporteur, I have experienced first-hand the fundamental differences in approach and perception between the right and the left. We in the EPP believe in a market-oriented approach, which strives to facilitate the shift to circular business models, sustainable innovation and green trade.

Meanwhile, the Socialists and the Greens would prefer bans, restrictions and obligations that would harm competitiveness and leave businesses - already burdened by the pandemic - with even slimmer resources to invest in sustainability. The report was improved substantially through long and hard negotiations.

Regrettably, however, the version adopted - with many abstentions in the Committee on Internal Market and Consumer Protection (IMCO) - was largely a wasted opportunity, since it ignored the most important measures needed to create a sustainable single market.

The IMCO Committee’s own-initiative report shows that the path to creating a sustainable single market will not be easy, and that we are a long way from political consensus on the best way forward. However, I remain hopeful, because I know that innovation and entrepreneurship are already leading the way to the green transition, despite what anti-market advocates claim.

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