The single market in the evolving European economic crisis: the role of Wales

Pic: Alicia Villegas

The economic crisis has prompted an urgent need to increase Welsh competitiveness within the European single market to achieve growth.

Eluned, Baroness Morgan, former MEP and honorary distinguished Professor at Cardiff University, yesterday warned to the Welsh business community to face up to the current economic climate.
The single market seems to work better in other areas than in Wales but, for Eluned, Baroness Morgan, the issue is not the EU lack of support but a Welsh problem.

“In Wales we have three cases of top level EU funding and we are going backwards,” she said. “I am not sure where is the problem of the lack of growth, I am trying to work out what are we doing wrong, because whatever we are doing at the moment is not working,” she added.

Eluned, Baronness Morgan, who is now employed by Swalec, a company that is keen to look at opportunities for closer collaboration in innovation and research and development in Wales, said also that the Welsh business community should look into trade within the EU, as 15 per cent of Welsh trading good are in the European market.

“People speak about the importance of reaching out to countries like Brazil, Russia, India or China, which are all there with huge potential, but the fact is that Welsh businesses have more trade in Ireland that they do with all of this countries together,” she said.

During a roundtable at Cardiff University in which the future of the European single market in the light of the global financial and economic crisis was discussed, Eluned, Baroness Morgan explained that, at the time of the creation of the single market within the UE, the Welsh business community was very supportive of it.
“The single market in Welsh economy is key because a lot of investment came into Wales, attracting Japanese and Korean investors,” she said and, referring to the trading opportunities within the UE, she added: “I think it is fair to say that the opportunities offered to Welsh business are immense because of this market of 500 million people.”

The single market can offer benefits, but also some challenges and, with the current economic crisis, these ones are even more demanding.

“We are living in a global market where competition is fierce, facing the particular challenge that we have an aging population, so unless we are going to act together, we will not be able to pay for our older population, which could lead to a social crisis,” she explained.

Apart from the higher competition within the single market, there are other challenges that need to be addressed. Michelle Cini, European Politics professor from Bristol University, pointed out that gaps in legislation within the single market were a problem.

“Where the gaps are, tend to be the most controversial areas and the most difficult areas to legislate,” she said.

Ms Cini said that the businesses complained about the lack of legislation. Also the dynamic within the single market was another important issue that must be addressed, along with the lack of public confidence in the single market to deliver growth.

“It seems to be a tendency, at general level, to particularly look at the EU as a solution to the problems being faced in the financial and economic crisis, but perhaps the solution should be provided by the national governments,” she said.

Ms Cini also explained that opposition to the EU by some countries like the UK within the EU is a risk as it could trigger fragmentation and a shaper “two speeds EU”. She also worried about the critical voices who oppose a dominant role for the market.

“These voices perceive the single market as an example of the EU adopting a neoliberal approach, even if the language of the reports and the Single Market Act is very much the language of social Europe,” she pointed out.

To face these criticisms Henrik Morch, from the European Commission, highlighted the achievements of the single market, particularly in terms of opportunities for business within the EU, such us the huge potential of ecommerce. Mr Morch said that for the across border market, ecommerce is still insignificant, making up about a 3 per cent in the EU market, but if it were to double by 2050, the economic benefit of that would be huge, up to €700 billion.

“The single market is now part of the solution, is even more important now than ever because of the economic crisis, but at the same time, it is seen as part of the problem. This is the risk and I think it is important to highlight the very confident benefits that inter-markets give,” he said.

Mr Morch added: “There is not a single bullet to revitalise the single market and create thousands of jobs and economic growth in one goal. It doesn’t exist: the single market is built piece by piece.”

Granada, the charm of the contrasts

La Alhambra / Pic: Ramón Villegas

In South Spain there is a place where the Muslim and Christian culture live together, creating a unique atmosphere, a mixture of unforgettable images, flavours and smells that can only be found in the city of Granada.

At the foot of Sierra Nevada, the highest peak in the Iberian Peninsula, lies the Moorish Alhambra Palace, the most emblematic monument of this multi-cultural city in Eastern Andalusia.

Considered the heart or Granada – not in vane it is a UNESCO World Heritage Site – the Alhambra is a magnificent complex that used to be the city, fortress and palace of the Kings of the Nasrid dynasty. Its extensive rooms, beautiful gardens and famous fountains make up the highest expression of Muslim art in Europe. On the hill opposite the Alhambra, is the Albaicín, one of the oldest districts of Granada. Its Moorish roots make this neighbourhood a charming place. It is well worth a walk through its labyrinth of narrow streets to see the gardens of the cármenes (its typical houses), as well as the wonderful viewpoints – such as San Nicolás and San Cristobal – and the colourful Arabic market, full of shops with souvenirs and crafts. And to end the long stroll, there is nothing better than an aromatic tea in the teterías located at the bottom of the hill, while watching the bustle of the tourists and the authenticity of the locals with the catchy Arabic music in the background.

The best way to approach the Christian Granada is to visit the Royal Chapel – where the Catholic Monarchs are buried – and the Cathedral, a masterpiece of Spanish Renaissance style, built by Queen Isabella immediately after the conquest of the city in 1942, which led to the disappearance of the last Arab Kingdom in the Peninsula.

Apart from its monumental and picturesque places, Granada is also well-known to be one of the few remaining cities in Spain where tapas are still served free. From the neighborhood of La Chana to the area known as Plaza de Toros, there are many areas in which ‘ir the tapas’ (go around to the bars eating tapas) means get a free lunch while consuming a couple of drinks.

For the flamenco-lovers the Sacromonte is a must-see neighbourhood. Famous for its caves, many of which have been transformed into bars where the gypsies sing and dance flamenco every night. It is impossible to transfer the beauty of the views of the Alhambra, the charming Albaicín, the architectonic variety and great entertainment of this city onto paper. Granada can’t be explained, it needs to be seen, felt and breathed to appreciate its atmosphere. Once visited for the first time, there will be an irresistible urge to come back again to this dreamlike city.

Easter in Granada

If you go to Granada during the Easter holidays and suddenly you see a group of people dressed up as if they belonged to the Ku Klux Klan, don’t panic, they are just penitentes, that is, members of the cofradías who participate in the processions of Semana Santa (Holy Week) in Easter.

Many people from Granada take this religious event very seriously, so the Granada processions are quite spectacular and passionate. Months before the Holy Week, the members of each hermandad (brotherhood) prepare the figures of their Christ or Virgin Mary for their own processions and make sure everything is ready for the event.

During the processions, the pasos (wooden platforms) with the figures are carried on the shoulders of the men known as costaleros. They are followed by queues of penitentes or nazarenos, dressed up with long gowns and a particular cylindrical hat.

In Granada there are many processions, but the most popular ones are the “Silent Procession” – where the street lights are turned off and people remain silent as the procession takes places – and the “Gypsy Procession” – with bonfires and saetas (traditional songs to the Virgin) sung by the believers.
This year the Holy Week in Granada takes place from 1st to 8th of April.

Women entrepeneurs

Equality and emancipation are meaningful words in today’s women lives, however, when it comes to examining true equality in the labour market, good news for women is not so good any more, neither globally nor in Wales.

For Alejandro Suárez, author of the book It’s time to assemble your own business, a major problem that women face is the gender gap in entrepreneurship at a global level. “Women have spent years claiming a place in the labour market, but now it’s time to promote a new social and cultural change in which women are not only eligible to hold a job, but to create it,” he notes.

More than 104 million women in the world were actively engaged in starting and running new business ventures, contributing significantly to entrepreneurship in the 59 countries studied in the report, According to the latest data from the Global Entrepreneurship monitor (GEM).

In spite of this achievement, the vast majority of the economies analysed have more men than women entrepreneurs and, therefore, the gender gap persists globally, according to a multi-year analysis from 2002 to 2010.

The proportion of all entrepreneurs who are women varies considerably among the economies: from 16 per cent in the Republic of Korea to 55 per cent in Ghana – the only economy with more women than men entrepreneurs.

In Wales, the percentage of women entrepreneurs decreased from 58 per cent in 2009 to 43 per cent in 2010, which meant a widening of the gender gap in entrepreneurship by 15 per cent and a drop of female entrepreneurship to 3.6 per cent – a figure which is statistically the same as the UK.

Let’s go back in time, to the year 2004. At that time, the outlook in Wales was completely different for women entrepreneurs. Wales was an example of equality in entrepreneurship in the whole world, having one of the best gender balances, as female entrepreneurship was at three quarters that of the male entrepreneurial activity.

“For a few years we had the Entrepreneurship Plan in Wales and within that there was a special focus on women and minority groups, because, at that time, that was a major policy of the government,” says Christine Atkinson, head of Women’s Entrepreneurship Hub at the University of Glamorgan.

Since the Entrepreneurship Action Plan finished, the upward trend for women entrepreneur has reversed.  Ms Akinson explains:  “With the recession and with changes in the policy, those sorts of support measures have gone. If you take the support structures away, then the trend of women entrepreneurs is falling back again.”

An institutional framework to support women entrepreneurs might be the key to reduce the gender gap, but, why are there fewer women entrepreneurs than men not only in Wales, but across the world? The answer is more complex than it seems to be at first sight.

In her article What Do We Know about the Patterns and Determinants of Female Entrepreneurship across Countries? Maria Minniti, a leading expert in global entrepreneurship, finds a possible answer looking into the subjectivity and possibly biased perceptions.

Particular cultural beliefs could influence women to have less self-confidence, opportunity perception, and, eventually, the prospect of starting a new business as a career choice. This could be a reason that explains why women are more likely to be motivated to set up a business by necessity rather than an opportunity, as well as less likely to believe they have the skills to start and run a new venture, according to the latest GEM report.

Discrimination against women as result of gender beliefs inherent in a culture or society could also reduce women’s likelihood of becoming entrepreneurs. Ms Minniti explains in her article: “Discrimination has been suggested as a possible explanation for the gender gap in entrepreneurship and this is likely to be more significant in poorer countries although the evidence is mixed.”

In other words, societal beliefs – especially in certain male-dominated fields – reflect gender bias, which makes things, such as being accepted by some clients or having good relationships with vendors, more difficult for women entrepreneur.

“Gender bias depends on who you deal with,” says Bianca Cridland, a 24 year-old entrepreneur from Swansea who set up her business Gower Soaps from scratch.

“If someone has a lower opinion of you because you are a woman, you can pick it up from the first impression and you can counter that immediately with the knowledge and skills you have, that’s my strategy,” she adds.

In spite of the stereotypes against women, Ms Cridland argues that being a woman is an advantage when it comes to getting help from other women. “It is an unwritten rule. From my experience, the majority of help I have had come from other women in business. Even if they haven’t been able to help me directly, then they gave me advice or contact details from someone else,” she explains.

Another reason that might have an impact on the entrepreneur gender gap is related to finance. Women may find more difficult than men to access finance to get started in business, according to a study based in the UK and carried out, among others, by Dylan Jones-Evans, Director of Enterprise and Innovation at the University of Wales.

To deal with this issue, the study suggests that support organisations should be created in order to make available start-up finance. Another suggestion includes the need to increase both financial awareness and literacy though entrepreneurship education programmes at university, so potential female entrepreneurs are aware of all financial options open to them.

Professor Ms Akinson points out other factor that must be considered when analysing the gender gap in entrepreneurship. “There is a big issue that women face, which is the whole issue of work-life balance: those women that have caring responsibilities still are trying to pursue business,” she says.

For Georgina Jones, Welsh entrepreneur and co-director of the Cardiff-based company Sing and Inspire, coping with the difficulties related to maternity issues depends on the support network. “I don’t have children, but my business partner has and I can see that, for many people with family, business life is more challenging because they have more commitment than me,” she argues.

Many obstacles for women entrepreneur haven’t gone away and there are still barriers that need to be address. Policymakers, society and women themselves need to work towards the reduction of the gender gap in entrepreneurship.  Just as a century ago thinking about equality and emancipation was a distant goal in women’s minds, the significant increase of women entrepreneurs in Wales and globally is a goal that can be achieved. As Mr Suárez suggests in his book on entrepreneurship, the change is possible, but there is no time to lose.