EU: LETHARGY AMID THE LOG JAMS. - After a burst of activity the EU is awash with half-completed projects, says Peter Wilsher.

by Peter Wilsher is a freelance consultant and writer.
Last Updated: 31 Aug 2010

After a burst of activity the EU is awash with half-completed projects, says Peter Wilsher.

Eurosclerosis was a word of the '70s and early '80s, coined to describe a condition where the Community (as it then called itself) seemed to have run out of energy and ideas. On that occasion the cure was provided by Jacques Delors and his drive to complete the single market, which galvanised the patient into a decade-long burst of sustained momentum and activity. But now, once more, the joints creak and the circulation grows sluggish, as the 12 member states (and the long queue of those wishing, more or less eagerly, to join them) grapple, often unenthusiastically, with today's log jam of unresolved problems, half-completed projects and untidily unfinished business.

Though impressive progress has undoubtedly been achieved in some areas - of the 282 separate pieces of legislation required to remove Europe's main internal trade barriers, for instance, no fewer than 268 had already been approved by the Council of Ministers by the end of last year - the sense of purpose has a nasty habit of evaporating as it reaches the lower levels of the regulatory and administrative pyramid. Only 115 of these laws are actually in force throughout the EU, and even fewer are being effectively implemented.

Britain, on the whole, has a good record with more than 90% of the relevant legal changes already given parliamentary endorsement. Ireland, Italy, Greece and, more worryingly, both France and Germany, are still struggling to get significantly above the 80% mark. And even when they catch up, says John Farnell, the head of the Commission's single market office, 'that only gets us to first base'. Actual implementation depends crucially on the detailed efforts of two groups, national civil servants and businessmen, and neither of these, in many vital areas, shows much sympathy for, or understanding of, the aims and issues involved. Foot-dragging tends to be the order of the day, in industrial sectors ranging from chemicals and automobiles to telecommunications (where almost everything has been put on hold while governments agonise over the prospective privatisation of their still mainly state-owned post and telephone services).

As a result, according to research carried out by the London-based Economist Intelligence Unit, 'Industry in Europe still suffers from enormous competitive handicaps, in terms of higher energy, communication and labour costs, by comparison with most other parts of the world, and certainly the US and Japan'.

Energy provides some particularly galling cases of missed opportunity. Ministers and officials have been talking for years about the potential gains to be had from TPA (meaning 'third party access') which would force the Continent's many entrenched and monopolistic utility providers to open their electricity grids and gas pipelines to anyone desiring to offer a competitive service. The potential gains for long-suffering customers have been calculated by the Commission at 70 billion ecus a year, or around £53 billion, but progress towards that target has been frustratingly slow. When the EU's Economic and Social Committee looked at this issue, in January 1993, they took fright and recommended postponing all further consideration for at least five years. Meanwhile the two most recent holders of the energy portfolio, Abel Matutes and Marcelino Oreja, appear to have thrown in the hard-line towel once waved by their aggressive predecessor, Antonio Cardoso e Cunha, and abandoned all hope of imposing TPA by mandatory means. When the subject is talked about at all now, it is purely in terms of 'voluntarily negotiated' arrangements, which for practical purposes probably means that it can be filed under 'pigs might fly'.

Similar frustrations beset the whole business of transportation. 'Free movement of goods' was supposed to be one of the prime 1992 objectives, and indeed there has been a wholesale bonfire of customs controls and the accompanying paperwork which used to make frontier-crossing such a nightmare. But getting more expeditiously from country A to country B, though a valuable improvement, is only one part of the obstacle course routinely negotiated by every freight forwarder, export manager and long-distance truck driver. To them the notion of 'the Trans-European Network' (discussed in this column in the July issue) remains a joke, as they attempt to make their way through the daily tangle of conflicting traffic regulations, road-tax regimes, and often appalling roads.

The German vehicle-manufacturers' association, VDA, calculates that long-term neglect of the transport infra-structure (exemplified by a 20% drop in Europe's annual road and rail investment between 1975 and today) has cancelled out more than two-thirds of the gain realised by improved vehicle design over the same period. And here the CBI reckons that the continuing lack of an efficient EU-wide distribution system costs Britain alone upwards of £15 billion a year.

Give or take the odd maintainance hold-up, the state of Europe's main trunk and autobahn systems is pretty good. It is the gaps, where a smooth six-lane highway suddenly degenerates into a narrow, pot-holed section where two cars would have difficulty passing, let alone two 40-tonne articulated lorries, that cause all the trouble. Often these deteriorations occur in places where there is no practical alternative route, and their cumulative effect, in time lost and deliveries missed, is an astronomical amount of waste.

For the driver inching a load of computer peripherals through a Greek pass designed more for goats than modern diesels, the effects of Eurosclerosis are still all too apparent.

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