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Keeping Europe’s steel sector competitive - 11/06/2013

Rolls of steel in a factory © iStockphoto

Action plan tackles fall in demand, environmental challenges and unfair competition with focus on cost-cutting and innovation.

The EU is the second-largest producer of steel worldwide, accounting for 11% of global output and employing over 360 000 people.

But times are hard. Demand has fallen with the global economic downturn, energy costs continue to rise, many raw materials must be imported, competition is often unfair and meeting environmental requirements can be expensive.

With global demand forecast to increase by 2025, it is in Europe’s interests to help the industry become more competitive. A newly released EU Commission action plan for the European steel industry tackles 7 key areas:

Regulation

The EU will assess the regulatory burden on the steel industry, checking that EU laws are not creating extra costs.

Boosting demand

The construction and automotive sectors account for around 40% of demand between them, and both have been hit by the economic crisis. Two EU initiatives will stimulate these sectors (CARS2020 and Sustainable Construction).

Fair competition

Some non-EU countries have introduced barriers to EU exports, or incentives for their own exports, giving an unfair advantage to their own companies. The EU will continue to negotiate free-trade agreements with non-EU countries, and challenge unfair practices.

Bringing down energy costs

Energy accounts for around 40% of the costs of producing steel, and European companies pay more than most of their competitors. The EU’s plan to interlink its energy market will increase competition and lower costs.

Climate policy

Clear environmental rules would encourage the investment needed to adapt to greener technologies. The Commission will promote best practices, but countries must also look into national polices affecting prices and set aside funding for energy efficiency projects.

Innovation

Between 2014 and 2020, almost €18 billion in EU funding will be available for strengthening industrial leadership in innovation through the Horizon 2020 research programme.

Support during restructuring

The steel sector has already lost 40 000 jobs through restructuring. There are funds in place to help those affected and to ensure that key skills are retained. As the steel workforce is ageing, the industry also needs to attract young and creative people.

A group will be set up to monitor progress in the areas above, and the Commission will take stock of progress in 12 months.

More on the EU’s steel sector

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