The History of the European Common Market

The European Common Market, now part of the broader European Union (EU), was a revolutionary initiative aimed at fostering economic integration among European nations. Its development was driven by the desire to ensure peace, stability, and prosperity in post-war Europe. This essay explores the history of the European Common Market, tracing its origins, key milestones, and impact on European integration.

Origins and Early Efforts

The origins of the European Common Market can be traced back to the aftermath of World War II, when European leaders recognized the need for economic cooperation to prevent future conflicts and rebuild their economies. Two key figures in this initiative were French Foreign Minister Robert Schuman and French economist and diplomat Jean Monnet. Their vision culminated in the Schuman Declaration of May 9, 1950, which proposed the creation of a European Coal and Steel Community (ECSC).

The European Coal and Steel Community (ECSC)

The ECSC, established by the Treaty of Paris in 1951, was the first significant step towards European economic integration. It aimed to pool the coal and steel resources of six founding countries: France, West Germany, Italy, Belgium, the Netherlands, and Luxembourg. The ECSC not only facilitated economic cooperation but also helped to reduce the historic Franco-German rivalry, laying the groundwork for deeper integration.

 The Treaty of Rome and the Creation of the EEC

Building on the success of the ECSC, the six member states sought to expand their cooperation to other economic sectors. This led to the signing of the Treaty of Rome on March 25, 1957, which established the European Economic Community (EEC) and the European Atomic Energy Community (EURATOM). The EEC, commonly referred to as the Common Market, aimed to create a single market by eliminating trade barriers and fostering the free movement of goods, services, capital, and labor.

Key objectives of the EEC included:

1. Customs Union: The elimination of internal tariffs and the establishment of a common external tariff for non-member countries.

2. Common Agricultural Policy (CAP): Ensuring a stable supply of affordable food while providing a fair standard of living for farmers.

3. Competition Policy: Preventing anti-competitive practices to ensure fair competition within the Common Market.

Early Challenges and Expansions

The early years of the EEC were marked by both successes and challenges. The customs union was successfully implemented by 1968, leading to increased intra-European trade and economic growth. However, political and economic differences among member states occasionally hindered progress. Notably, French President Charles de Gaulle’s veto of the UK’s membership applications in the 1960s delayed British entry into the EEC.

Despite these challenges, the EEC continued to expand. Denmark, Ireland, and the United Kingdom joined in 1973, followed by Greece in 1981, and Spain and Portugal in 1986. These expansions not only increased the EEC’s economic clout but also reinforced the idea of a unified Europe.

The Single European Act (SEA) and the Single Market

The Single European Act (SEA), signed in 1986 and implemented in 1987, marked a significant step towards achieving the Common Market’s goals. The SEA aimed to create a fully integrated single market by 1992, addressing various non-tariff barriers that still impeded the free movement of goods, services, capital, and labor. Key measures included harmonizing regulations, standardizing technical specifications, and removing fiscal barriers.

The single market project culminated in the Maastricht Treaty, signed in 1992 and effective from 1993, which transformed the EEC into the European Union (EU). The Maastricht Treaty introduced new areas of cooperation, including a common foreign and security policy, and paved the way for economic and monetary union, with the ultimate goal of adopting a single currency.

The Euro and Economic and Monetary Union (EMU)

The introduction of the euro in 1999 was a monumental achievement for the European Common Market. Initially adopted by 11 member states, the euro aimed to facilitate trade, reduce exchange rate risks, and enhance economic stability. The Economic and Monetary Union (EMU) established a framework for coordinating economic policies and maintaining fiscal discipline among member states.

However, the EMU also posed significant challenges, particularly during the eurozone crisis of the late 2000s. The crisis exposed the vulnerabilities of having a single monetary policy without a fully integrated fiscal policy. Member states had to implement austerity measures and structural reforms to stabilize their economies, leading to debates about the future of the euro and the need for deeper economic integration.

 Enlargement and Deepening Integration

The EU’s enlargement continued in the 21st century, with the accession of several Central and Eastern European countries in 2004, 2007, and 2013. These enlargements expanded the Common Market to include 28 member states, enhancing its economic diversity and geopolitical significance. The EU also deepened its integration through treaties such as the Treaty of Lisbon (2007), which reformed its institutions and decision-making processes to improve efficiency and democratic accountability.

 Impact and Legacy

The European Common Market has had a profound impact on Europe and the world. Economically, it has facilitated unprecedented levels of trade, investment, and economic growth among member states. The free movement of people has enhanced cultural exchange and fostered a sense of European identity. Politically, the Common Market has helped to ensure peace and stability in a historically volatile region, demonstrating the power of economic cooperation in achieving broader political goals.

Moreover, the European Common Market has served as a model for regional integration efforts worldwide, inspiring initiatives such as the North American Free Trade Agreement (NAFTA) and the Association of Southeast Asian Nations (ASEAN).

Challenges and Future Prospects

Despite its successes, the European Common Market faces ongoing challenges. The eurozone crisis, Brexit, and rising populism and nationalism have tested the resilience of the EU and its commitment to integration. Addressing economic disparities, managing migration, and responding to global challenges such as climate change and technological disruption will require continued cooperation and innovation.

The future of the European Common Market will depend on the EU’s ability to adapt to changing circumstances and maintain the balance between national sovereignty and collective action. Efforts to complete the banking union, deepen fiscal integration, and enhance the social dimension of the single market will be crucial in ensuring its long-term sustainability and success.

Conclusion

The history of the European Common Market is a testament to the transformative power of economic integration. From its origins in the aftermath of World War II to its evolution into the European Union, the Common Market has played a vital role in fostering peace, stability, and prosperity in Europe. While challenges remain, the enduring legacy of the European Common Market underscores the importance of cooperation and unity in achieving shared goals and addressing common challenges.