Single market
Encyclopedia : S : SI : SIN : Single market
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| Free trade area |
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| Common market |
| Economic and monetary union |
A single market is a customs union with common policies on product regulation, and freedom of movement of all the four factors of production (goods, services, capital and labour).
Sometimes a single market is differentiated as a more advanced form of common market. In comparison to common a single market envisions more efforts geared towards removing the physical (borders), technical (standards) and fiscal (taxes) barriers among the member states. These barriers obstruct the freedom of movement of the four factors of production. To remove these barriers the member states need political will and they have to formulate common economic policies.
This is the fourth stage of economic integration.
Single market is established through trade pact.
List of Single Markets
Every Economic and monetary union has also a Single Market- the European Community (EC), informally known as the Common Market. The European Union single marketprogramme was established in the late 1980s and has been under development ever since. The EC formally became a single market in 1992 when the Maastricht treaty was signed. However the common market project dated back to the founding of the EEC in 1957. The abolition of internal tariff barriers was achieved in 1968. In subsequent years little was done to move from this basic customs union to a full single market. It was not until the Single European Act (1986) that the final barriers to free movement of people, goods and services were removed. Further information on the European Union single market can be found [here] and then some...
- European Economic Area (EEA) between the EC, Norway, Iceland and Liechtenstein
- the Caribbean Community single market (CARICOM)
Proposed
- Economic Community of West African States (ECOWAS)
- Central African Common Market of the Economic Community of Central African States (ECCAS)
- Gulf Cooperation Council (GCC), due in 2007
- Southern African Development Community (SADC), due in 2012
- ASEAN Economic Community (AEC), due in 2020
- African Economic Community (AEC), due in 2023
Benefits of a single market:
A single market has many benefits. For both busineses within the market and consumers- a single market is a very competitive environment. This means that inefficient companies will suffer a loss of market share and may have to close down.However, efficient firms can benefit from economies of scale, increased competitiveness and lower costs, as well as expect profitability to be a result. Consumers are benifited by the single market in the sense that the competitive environment brings them cheaper products, more efficient providers of products and also increased choice of products. What is more, businesses in competition will innovate to create new products- another benifit for consumers. (BBarnes)
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