The “Single Market” explained
by To protect jobs, living standards, our economy and public services, we will continue to fight for membership of the European Single Market.
Here’s why single market membership is important.
The single market is over eight times the size of the UK market.
It has been achieved by removing barriers to trade and having a single set of trade rules across all member states. The aim of the EU’s single market, put simply, is to make it as easy to trade between Edinburgh and Dusseldorf as it is between Edinburgh and Dundee.
Labour and the Tories both talk about “access” to the Single Market. It’s not the same as membership. And the difference is important.
Both Jeremy Corbyn and Theresa May want to take us out of the Single Market. And, instead, they’re talking about access. But, there’s barely a country on earth that doesn’t have ‘access’ to the Single Market – from Albania to Zambia. But it is access at a price – sometimes a high price.
“Any countries that are not subject to trade sanctions can trade with members of the Single Market…But there is a big difference between being able to trade with the Single Market and being a member of it. For instance, the United States sells into the Single Market but there are no common safety standards for goods such as fridges or cars and tariffs and quotas may be imposed on its products.”
Being dragged from the Single Market would damage our our economy, jobs, and living standards.
- Scottish Government analysis shows a potential cost to the Scottish economy of up to £11.2 billion per year by 2030.
- Scottish Government analysis also shows that the reduction in funding available for public services could be up to £3.7 billion per year. That’s more than double the annual budget for Scotland’s universities and colleges.
- The independent Fraser of Allander Institute has forecast that a hard Brexit could cost Scotland up to 80,000 jobs within a decade.
- Scotland’s cities are amongst those to be hit hardest. Of all UK cities, Aberdeen will be hit hardest by Brexit with the biggest fall in economic output, according to a report from the Centre for Cities and the Centre for Economic Performance at the London School of Economics. Edinburgh ranked sixth hardest hit.
- The Fraser of Allander Institute also estimates that after 10 years average wages could fall £2,000 a year per head.
- It could mean working longer and retiring later. Professor Sarah Harper, Director of the Oxford Institute of Population Ageing and Chair of the UK government’s ‘Future of an ageing population lead expert group’ said: “if all migration into the UK was to be halted, then over the next five years, those coming up to retirement would have to work about one-and-a-half years longer just in order to maintain current [GDP] output.”
- Removing Scotland from the Single Market will make it a less attractive location for foreign direct investment. Since 2006, Ernst & Young have estimated that 40,000 jobs have been created in Scotland as a result of foreign direct investment. Ernst & Young found that almost 80 per cent of investors say that being within the European Single Market was an important factor in their decision in the UK. A KPMG survey showed that over three quarters of businesses are considering relocation. The OECD has said “if access to the single market was lost, lower FDI inflows would seem unavoidable, reducing the inflows of new ideas and knowledge into the UK.”
- Exports will take a hit. Economic think-tank the NIESR has found that exports from the services sector could be cut by 60 per cent if we are taken out of the Single Market. In Scotland this could be equivalent to a £2.3 billion hit. The NIESR also estimate that being outside of the Single Market would mean a reduction in trade in goods of 35-44 per cent. For Scotland, that could cost an additional £3 billion.