Issue 16, 2024 - This week's editorial: Europe flirts with deindustrialisation, must remain competitive: conference

European industry has to contend with costly decarbonisation while remaining competitive and ensuring business continuity, against a challenging backdrop of diverging attitudes between East and West. European deindustrialisation is taking place and needs to be tackled effectively, participants said at last week’s Industry in Transition conference in Katowice. The EU’s climate ambition is admirable, but the bloc is missing a cohesive industrial policy that “connects the dots”, Eurofer director general Axel Eggert said. So far, the EU has only introduced “silo policies”, specific to each economic sector, he added, while the US Inflation
Reduction Act was a “wakeup call” for the bloc.

European steelmakers are hampered by high energy prices and trade distortions by third countries, with access to clean electricity and clean hydrogen lacking. “We need an EU industrial policy that helps industry make it through the transition but also recognises that industry is a factor for the transition itself,” Eggert observed. Steel is a critical material for renewable industry development.

Deindustrialisation is however putting this under threat. The EU produced 126 million tonnes of crude steel in 2023 compared to almost 180mt in the early 2010s. “If we want to produce all the steel Europe needs, this trend needs to stop now,” Eggert warned.

European industry’s quest for autonomy will take time, pointed outCritical Raw Materials Alliance secretary general MauritsBruggink. While ten years ago, the EU was looking just to secure raw materials supply for certain industries, the bloc now understands the importance of vertical integration and is thinking about a “mine to markets approach”, Bruggink noted. However, the vast majority of the EU’s 34 critical raw materials (CRMs) are imported, and this will take some time to rectify, he added.

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