Finnish Industries’ key takeaways on Enrico Letta’s Report on the EU Single Market

In April 2024, the former Italian Prime Minister Enrico Letta presented his report on the future of the Single Market. On May 30.-31, Mr. Letta will visit Finland to discuss his proposals. The Confederation of Finnish Industries EK has identified some key takeaways from  the Letta report which  the next  EU Commission should advance.

The subject of Letta’s visit to Finland is his report, delivered in April. The report commissioned by the European Council, contains significant proposals to empowering the Single Market to tackle future challenges.

The report is very relevant for Finnish businesses, says Lotta Nymann-Lindegren, Director of EU Affairs at Finnish Industries EK:

“60 percent of Finland’s exports go to EU countries. Therefore, it’s excellent that the development of the Single Market receives high-level attention. By boosting the Single Market, we also strengthen the EU’s ability to compete globally and to attract investments. Letta’s recommendations must not be forgotten it’s crucial for the new Commission to seize the opportunity  and advance their implementation of key proposals swiftly and pragmatically.”

Finnish Industries EK has identified the following key proposals  from the Letta report:

• Closing the investment gap: EK has called for an EU-level solution to the state aid competition between member states. Letta proposes a new financial instrument for strategic investments. The proposal corresponds in principle to the EU instrument proposed by EK in February, provided that the so-called excellence principle is adhered to it: funding should only be granted based on the excellence principle of projects that strengthen the green transition and the defense industry.
• Promoting the Capital Markets Union: EK believes that the Capital Markets Union should be developed further. Letta  calls for  the creation of genuine capital markets to accelerate economic activity and facilitate the flow of funds between member states. The securitization markets for loans need to be revitalized. Taxonomy and other sustainable finance instruments should be further developed.
• Greening the Single Market: The green transition and the Single Market for the circular economy are central objectives for EK. Letta underlines the importance of clean and affordable energy and a functioning energy market for the future of the EU economy. The Single Market must be made fit for a circular economy, including ensuring access to recycled raw materials.
• An infrastructure for the future: EK works to strengthen European energy, transport, and digital connections (TEN networks). Letta emphasizes the importance of TEN transport networks as basis for EU growth and competitiveness. He also suggests strengthening the CEF financial instrument to contain climate change and military mobility. This is essential for Finland’s accessibility.
• The digital and data economy at the forefront of Single Market This is wellrecognized in the Letta report, including the interesting concept of a new ‘fifth freedom’: in addition to the free movement of people, goods, services, and capital, skills and knowledge should also be allowed to move more flexibly within Europe. This should be pursued, for example, by expanding the mutual recognition of degrees and professional qualifications.
• A more active trade policy: European companies must gain better access to global markets. Letta also highlights this, suggesting that trade agreements need to be reformed to meet the needs of the new era in trade and geo economy. in export control and sanctions monitoring, more coordination is needed.