EU national retail markets too slow to integrate

BRUSSELS – Seventeen years after the European Union (EU) shed its internal borders, the bloc remains a patchwork of national retail markets, the European Commission has said.

It said because retailers – from main street shops to hypermarkets selling anything over the counter and online – fail to take an EU-wide approach they are limiting growth at a time when Europe needs it most.The EU retail sector accounts for 4,2 per cent of the EU’s gross domestic product (GDP) and comprises 20 million small and mid-sized businesses.It is an underperforming sector, said an EU report, because retailers from Portugal to Finland to the Greek islands still cater largely to their national markets only although the EU removed its internal borders to trade in 1993.In a report Michel Barnier, the EU single market commissioner, said 35 per cent of the EU’s 500 million people live in border areas that should be prime targets for competitive pricing strategies and tit-for-tat retail offers across national boundaries.’Retail services employ nearly 18 million people,’ Barnier said. ‘We can create more economic growth by taking away difficulties that retail services face.’One priority, he said, is reversing Europe’s sluggish e-commerce sector. Cross-border delivery costs, fuzzy or costly payment systems and lack of legal redress prevent online shoppers from buying across the border.Other problems include differences in labour laws and sales promotion rules and big price gaps – the cost of food and non-alcoholic drinks is, on average, 28,4 per cent higher in Belgium than in the Netherlands.Barnier plans to make specific legislative proposals to create a more integrated EU retail sector in the fall.The European Commission sees that as a crucial element of its economic strategy for the next decade which calls for annual growth of at least two per cent. – Nampa-AP