The New Europe bushcountries and services directive

February 20, 2006

The EU recently voted in favour of having a services directive – but it’s a crippled one. The BBC website has a nice Q&A on it.

In short, the services directive is aimed at creating a functioning services market across Europe – which should in theory already exist. In practice, there are many details stopping it from working. So the directive wants to tear them down. But it met heavy resistance from the “old Europe”. As they BBC says:

However, critics said that the way the Commission formulated the directive, it could result in domestic companies being priced out of the market by cheaper, foreign competitors.

Hello??? It’s called competition. That’s what the market is about. So do I get it right? The “old Europe” guys are absolutely fine to enter the new markets with their products – consumer electronics, retail chains etc etc etc, and reap the benefits. But if “new Europe” wants its own piece of the market by being able to compete with the same open principles (and not implying the services provided are necessarily better or worse), the “old Europe” people step up and say it’s not going to happen.

I’m from a “new European” country. To me, not being allowing my companies real access to the services market, or myself personally access to the European labour market, is personally offensive from all of the “old European” country governments and people. It’s a way of saying from EU, “welcome to the club where we can now sell you all our stuff and collect all sorts of money from you and redistribute it to our farmers. Now, go stand in line outside with the other second-class people, and we now play it like all of your country consists of plumbers and illegal construction workers who would come here and overtake our life, so, we’re afraid of you and we have to protect us from you.”

I find it both derogatory and ridiculous. If the EU really wanted to become successful, it would make its reforms more radical and end this nonsense and stood up against its real competitors EU and Asia. But no, it’s much too much fun to focus on the internal quarreling. And alas, there’s no quick hope of the countries and people changing their views – all the EU and competition stuff is a bit too far from them. The one hope is that all the new EU countries share these views and can unite with some of the more reasonable countries like EU to develop and further a common position on eliminating the internal barriers.

This is definitely not to say all the new countries are doing everything right themselves. Most of the public discussion in Estonia about the EU among politicians, business folks and other figures of public life appears to be about how much cash we are receiving from the EU. So even if there was a liberal services market, I’m not sure how many Estonian entrants there would be from day one.