Europeans Are Getting Ready to Ring In 1992 : Year Will Bring Forth New Era of Free Trade

The commercial on British television gets straight to the point. “Industry must be ready when Europe opens for business. Ring 200-1992.”

Business people who dial that number are put through to a hot line at Britain’s Department of Trade and Industry.

They are told of the money-making opportunities that will open up in 1992, when the European Community plans to abolish all trade barriers between its 12 member nations and remake itself a single market of 320 million souls.

British Campaign

Promoting the European idea is hard work in a country where many people are by tradition insular and refer to the rest of Europe as “the Continent.”

“Almost 80% of British businessmen are now aware of 1992 as a target date, from only 16% when we started the advertising campaign last April,” DTI spokesman Guy Nissen said. “But awareness is one thing--making sure that industry is taking the necessary actions another.”

European Community officials say that Britain is not the only country where the government is worried about whether industry is ready to face the harsh realities of a single market in which goods, capital, services and people will move freely across frontiers.

A recent study by the European Community Commission showed that around 250,000 jobs could be lost initially as firms gear up for tougher competition. Many companies currently protected by state regulations or outright favoritism could see their profits squeezed.

Another survey showed that public support for the European Community appeared to be waning, especially in Britain and West Germany. European Community officials in Brussels speculate that the man in the street may be afraid of 1992.

France started a promotional campaign in 1987 to educate people about 1992 and reported considerable success. In West Germany, managers and politicians are trying to impress executives with the magnitude of the event.

Conferences Planned

Britain’s DTI is organizing conferences and providing access to data banks and fact sheets about the single market. “We are probably leading Europe in that,” Nissen said.

But Britain’s industries may be especially vulnerable.

British manufacturing has been in decline in recent years, with the sector now producing 3% less than in 1979. Industry has been beset by lack of investment, trade union problems and poor management, economists say.

More than half the population works in services, including banking, tourism, leisure, transport and retailing. With the relative decline of manufacturing, the earnings from London-based finance--banking and insurance--assume greater importance.

Prime Minister Margaret Thatcher makes no secret of her determination to use the European Community single market to help shock British business into being more competitive.

But some politicians see some of Thatcher’s positions as jeopardizing London’s standing as a financial center.

Thatcher’s Policies

Thatcher’s refusal to fully integrate the British pound into the European Monetary Union and her rejection of the idea of a European Central Bank or European Community currency is seen by politicians like Michael Heseltine, a former defense minister, as endangering London’s position as a center of global finance, ranking with New York and Tokyo.

“But, to make permanent that success, London must house the institutions which develop to ‘manage’ Europe’s economy,” Heseltine wrote in a recent newspaper article.