Production: By Europod, in co-production with Sphera Network.
EUobserver is proud to have an editorial partnership with Europod to co-publish the podcast series “Briefed” hosted by Léa Marchal. The podcast is available on all major platforms.
You can find the transcript here if you prefer reading:
After several years of industrial decline, the European Commission proposed a ‘Made in Europe’ policy on 4 March.
Is this a major industrial turning point?
The European Union is one of the most open continents to trade.
But today, it’s costing them.
94 percent of the solar panel cells used in the EU come from China. Europeans also struggle to produce batteries, which are highly strategic for the green transition.
That’s why the EU now wants to tighten the screws and close off its market where necessary.
How?
By excluding, for example, Chinese bidders from European public procurement in the following sectors: steel, cement, aluminium, automotive, and all green technologies
Concretely, these products will have to be manufactured in the EU, or in a partner country, to a given percentage at least. This effectively excludes certain bidders, whose production is 100 percent outsourced.
The text also concerns industrial projects supported by European public funds, which are sometimes led by foreign investors.
The goal is clear: European taxpayers’ money must support production on the continent.
This isn’t just about excluding China, but all countries that don’t have trade agreements with the European Union or haven’t committed to opening their public procurement.
Those that have, like India — with whom the EU could sign a free trade agreement — will be able to access European public procurement
What about the United States? The EU follows a logic of reciprocity. In that sense, Europeans could well decide to exclude the US. Because Donald Trump has restricted access to US public procurement in recent months with his "Buy American" doctrine.
So, does the future regulation mark the end of the European Union’s open trade policy?
Only partly.
This text, called the Industrial Accelerator Act, represents a major shift for Europeans, who have long been staunch defenders of free trade.
And it’s a victory for France, which has been advocating in Brussels for a more protectionist — or rather, less naive — industrial policy, as the French government often describes it.
"If we do nothing, it’s highly likely that cleantech technologies will be 100 percent produced in China, and that our cement and steel industries will be 100 percent offshored in a few years."
That’s how the vice-president of the European Commission, Frenchman Stéphane Séjourné, justified the Industrial Accelerator Act to the press on Wednesday.
But not everyone is happy with the text.
Several EU countries have already expressed reservations about the concept of European preference, including Germany, Sweden, Finland, and the Netherlands.
In the episode of Briefed from February eleventh, I explained why these countries oppose "Made in Europe."
Under their influence, the scope of sectors covered by European preference has been reduced in recent weeks. The Commission had, at one point, considered including semiconductors, artificial intelligence, and other advanced technologies.
Similarly, the definition of European preference had to be broadened to include EU partners, as explained earlier.
Now, what will happen with this text?
The path to its adoption and concrete implementation is still long and winding.
Before being adopted, the draft regulation will have to satisfy the European Parliament and, above all, the EU’s 27 member states.
Moreover, opponents of the text are determined to limit its effects. So, by the end of negotiations, the Industrial Accelerator could allow third-country bidders to participate in European public procurement more flexibly.
In summary, the European Commission is initiating a shift that could prove to be a major industrial turning point, provided a majority of member countries rally behind the principle of European preference.
