A single market is a form of trade cooperation between states who try to remove restrictions on goods and tariffs when trading with each other. To access the single market states must agree to core principles, such as free movement of goods (like a free trade area and customs union), people, services and capital. Physical and fiscal borders are removed between member states to the maximum extent possible. Single markets encourage trade and healthy competition between states, they enhance efficiency and improve the quality and prices of goods traded.
With regards to the EU, The European Single Market has fuelled economic growth and made the everyday life of European businesses and consumers easier. The EU also sets rules on the goods that are traded, such as guidelines on packaging, safety and standards. This means everything that is traded is raised to a fair standard and competition is driven by quality. A state can be in the EU’s Single Market, but not the EU, this is what Norway, Iceland and Liechtenstein do. Therefore, remaining in the single market is a key issue with regards to Brexit.
Tariffs – Border taxes. Money charged to sellers wanting to import goods into the country, raises revenue and encourages domestic production.
Free Movement – legal permission for workers or citizens within a union of countries to move between member states, whether visiting or working.
Free Trade Area – A group of countries between whom any trade tariffs, quotas or other restrictions have been removed (see Free Trade article for a more detailed explanation).
Customs Union – a group of states that have agreed to charge the same import duties as each other usually to facilitate free trade amongst them (see Customs Union article for a more detailed explanation).
Capital – A loose term for generating wealth. Financial assets or goods that generates more wealth.
Fiscal – relating to taxes. A Government changes the tax to maximise the country’s economy and prosperity.
Brexit – British Exit from the European Union.