Transport is often seen as secondary, but it is at the core of the EU freedom of movement, writes Siim Kallas.
Siim Kallas is former Vice-President of the European Commission, who was in charge of transport policy. He is currently a professor of international economics at the University of Tartu.
Transport has become an essential part of our daily existence and also of our daily spending. It gives people access to every kind of place imaginable: to the workplace, to shopping and leisure centres. It is how people can have access to each other.
Freedom of movement is a cornerstone of European liberty and a massive achievement in itself. It changes and opens minds. But it’s also something that we tend to take for granted, so we need transport to make sure that this freedom is guaranteed.
But I still feel quite often that transport is seen as secondary. Transport policy, and especially its achievements, are not even used or mentioned in the debate about the essential nature of the European Union, and neither to any acceptable or real extent in the discussions between Eurosceptics and pro-Europeans.
Over the decades, developments in European transport policy have helped to strengthen the wider EU internal market by opening up national markets previously dominated by public monopolies. These companies, and often their governments as well, tend to be more sceptical about pan-European projects that may threaten their strong market and business positions. This perspective, apart from being national and short-term, weakens what we are trying to do to build a genuinely efficient and smooth transport network across Europe.
This legacy of public monopolies has meant that transport is one of Europe’s few sectors which still have legal obstacles to market entry and service provision: in domestic rail markets, port services and road transport. Even where they have been removed, new companies wishing to enter a transport market often face technical and administrative obstacles.
These numerous barriers to access along with complex bureaucracy and distortions of competition across EU countries (pricing, taxes and other charges) are gradually being removed as part of the process of creating a genuine single European transport area.
But there are areas to improve: ground-handling at airports, and air navigation services, for example. Air traffic control is still organised on a national basis and suffers from duplications and inefficiencies. Slot allocation could be improved to allow congested airport infrastructure to accommodate more passengers.
Many important elements of transport infrastructure enjoy a monopoly position. It is almost impossible to create alternatives for existing ports, airports and railways just by building new ones nearby. So the economy of infrastructure that is already in place and functioning is very specific and complicated.
Financing infrastructures is another barrier EU should work on. Some infrastructure investments need time to achieve the productivity necessary for financial self-sustainability. During such a period, public sector involvement can be helpful to provide the certainty that private investors need.
But it remains a difficult and complicated challenge to find the right balance between the two.