Malta reaps “substantial benefits” from Single Market

Economist raises concern about the trend of the European centre-right collaborating with, or adopting policies from, far-right groups, which could threaten the internal market’s integrity.

MEP Alex Agius Saliba and economist Frans Camilleri both agree that the European Single Market has brought substantial benefits to Malta.

The two were The Journal editor Sandro Mangion’s guest on Kafè Ewropa, ONE’s weekly European election talk show, discussing the European Union’s endeavours to create a seamless economic zone across its member states by removing barriers to the free movement of goods, services, capital, and people. This, in turn, boosts competition, lowers prices for consumers, and creates a more dynamic European economy.

The Single Market, also known as the European internal market, has both upsides and downsides, as Frans Camilleri acknowledges. However, overall, there is general agreement that since Malta’s EU membership in 2004 it has significantly benefited Maltese consumers. It has increased competition, which can potentially lead to lower prices and a higher purchasing power. At the same time, consumers now enjoy a much wider selection and higher quality of goods. However, this wider selection came at a cost, with some local manufacturers struggling to compete and ultimately ceasing production.

Frans Camilleri points out that manufacturing has shrunk as a share of Malta’s total production output since joining the EU two decades ago. While acknowledging the decline started before accession, he argues that wider competition from other member states producing similar goods exacerbated the trend. Since firms in most other EU countries benefit from larger economies of scale, they could undercut Maltese products on price, making them uncompetitive.

However, as the saying goes, there’s always a silver lining. The economist points out that this intense competition has actually driven Maltese manufacturers to innovate. They’ve upgraded their products and targeted specialised market niches where they can compete effectively and even export.

Frans Camilleri, economist.

Camilleri warned that the European Single Market is currently facing challenges that, if left unaddressed, could threaten its integrity or smooth functioning. These include excessive regulation and the resurgence of nationalist sentiment in some member states, that could lead to policies that restrict the free movement of goods, services, people, and capital. This would fragment the internal market and undermine its core principles. He voiced concern about the trend of the European centre-right collaborating with, or adopting policies from, far-right groups.

Continued effort and political will are absolutely necessary to ensure the European economy’s competitiveness and productivity, thus guaranteeing the Single Market’s continued success, said Frans Camilleri.

Tangible and beneficial

MEP Alex Agius Saliba, who is also Vice President of the Progressive Alliance of Socialists and Democrats (S&D) in the European Parliament, called the European Single Market the most tangible and beneficial aspect of the European Project for ordinary Europeans.

He explained how, over time, the EU has implemented regulations that safeguard European consumers’ health and safety. These regulations ensure that the Single Market adapts to the ever-changing world – particularly in light of digitilisation – without compromising consumer rights or market functionality. “This has been the main focus of my work as a European legislator in these past five years,” said Alex Agius Saliba, who also serves as a member of the European Parliament’s Committee on the Internal Market and Consumer Protection (IMCO).

He recounted his first major responsibility as an MEP. It came at a critical time, as the Covid pandemic unfolded, when he was appointed the IMCO rapporteur for both the Digital Services Act (DSA) and the Digital Markets Act (DMA). These two important pieces of European legislation significantly revamped the previous, outdated, legislation on e-commerce – the Directive on Electronic Commerce – ushering in a major global shift in how online platforms and e-commerce are regulated. The DSA prioritises consumer protection, ensuring a safe online environment. In contrast, the DMA emphasises fostering a fair and competitive digital marketplace.

Alex Agius Saliba, MEP.
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