Brussels: Europe’s single market is the Union’s crown jewel and, increasingly, its biggest worry, as the European Commission warns that the bloc keeps losing ground to rivals unless it tears down the barriers still splitting its own economy.

The 2026 Annual Single Market and Competitiveness Report, published on 30 January, tracks 29 indicators of economic health. Six improved, six worsened and fifteen barely moved, a verdict of near-stagnation that officials call unacceptable in a volatile world. The report blames fragmented rules, weak investment and a flood of subsidised imports for squeezing European industry just as global competition sharpens.

President Ursula von der Leyen answered with a slogan and a deadline. Her One Europe, One Market roadmap, unveiled to EU leaders in February, promises a fully integrated single market by the end of 2027 and targets late payments, service barriers and the tangle of national rules that still block cross-border trade. The Commission wants fewer forms, faster approvals and deeper pools of capital for firms that want to scale up.

The push draws directly on Mario Draghi’s landmark report on competitiveness, which warned that Europe risks a slow decline as the United States and China out-invest it in technology and clean energy. Draghi urged hundreds of billions in extra spending and far tighter integration, and the Commission has embraced the diagnosis even if it has not yet named the full price. His warning that Europe must grow or shrink now frames almost every economic debate in Brussels.

Services remain the stubborn frontier. Goods move freely, but a lawyer, architect or engineer still hits a wall of national licences the moment they cross a border, and small firms shoulder compliance costs that their American rivals never face. The Commission floats a voluntary set of common rules, sometimes called a 28th regime, to let companies operate under one European framework instead of twenty-seven.

Delivery remains the hard part. Analysts note that roughly half the report’s indicators have not budged since 2023, and member states still guard their national champions and rulebooks jealously. A first phase of the Savings and Investment Union, meant to steer household savings into European firms, fell due by mid-2026, with more legislation promised later in the year.

The stakes stretch well beyond growth charts, because a weaker single market means fewer jobs, thinner defence budgets and less leverage abroad. The Commission laid out its findings in the 2026 Single Market and Competitiveness Report and an accompanying press statement. Whether Europe can act on its own warnings, before the gap widens further, is the question hanging over the year.