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Europe does not need to drive manufacturing away in the name of protecting steel. It needs to create the conditions so that producing in Europe becomes a competitive advantage once again.
Europe faces a contradiction today that should concern everyone who believes in its economic, social, and environmental model. We want a strong, decarbonised, technologically advanced industry that is capable of competing globally. Yet, all too often, the measures we adopt to protect it end up weakening the very sectors that contribute most to this ambition.
On 1 July 2026, new measures to protect the European steel industry entered into force. These come on top of the Carbon Border Adjustment Mechanism (CBAM), which entered its definitive phase on 1 January 2026, and a series of anti-dumping measures targeting imports from third countries. The intention is understandable: to respond to global overcapacity, competition from producers with vastly different cost structures, and the risk of European deindustrialisation.
The problem, therefore, lies not in the diagnosis, but in the remedy.
Europe’s steel industry is under pressure from high energy costs, stricter environmental requirements, heavy investments in decarbonisation, and highly asymmetric international competition. It would be naive to argue that this context does not require a policy response. But it would be equally naive to believe that tariffs, quotas, and trade barriers alone create competitiveness.
They do not. They can buy time. But if that time is not used to reduce structural costs, accelerate permitting, secure competitive energy, support productive investment, and simplify life for companies, protection becomes a hidden tax on the entire European industrial value chain.
This is where Europe’s current approach reveals its greatest weakness.
By prioritising the protection of primary steel production, the European Union risks leaving the downstream manufacturing industry, which relies on that steel to produce higher-value downstream products, deeply exposed. Metal packaging, industrial components, machinery, equipment, consumer products and countless other value chains are forced to buy more expensive raw materials. Meanwhile, competitors based outside the European Union can source steel at more competitive international prices and then export finished manufactured goods back into the European market.
The result is counterproductive: one part of the chain is protected, but the entire ecosystem is undermined. Ultimately, this can end up incentivising exactly what we sought to avoid: the relocation of industrial production outside Europe.
This risk is particularly evident in the European metal packaging industry, which has invested heavily in efficiency, automation, reducing material consumption, circularity, and quality. We are not talking about an industry stuck in the past. We are talking about a sector that has modernised its processes, reduced material thickness, improved its environmental performance, and responded to the growing demands of clients and consumers.
Furthermore, metal packaging is one of the finest examples of real circularity. Steel and aluminium are permanently recyclable materials that lose none of their inherent properties. Long before the circular economy became a central phrase in European policymaking, these materials were already putting it into practice on the shop floor. These materials were not born for single, disposable use; they were born for circularity. This is particularly vital at a time when Europe demands greater sustainability, increased recycling, and reduced dependence on virgin raw materials. Metal packaging ranks among the packaging materials with the highest recycling rates in Europe. Consumers might not fully realise this when they toss different materials into the recycling bin, but the reality is clear: when it comes to circular performance, metal is one of the unsung champions of the green transition.
And yet, it is precisely this industry that risks being penalised by poorly calibrated trade policies.
If a European metal packaging manufacturer is forced to purchase more expensive steel due to protective measures, while a competitor located in a country close to Europe, with favourable trade agreements, buys cheaper steel on the global market and exports the finished packaging into the European Union, what will we have achieved? We will have protected European steelmaking, but exposed European steel packaging manufacturers.
This is not a theoretical debate. It is a matter of tangible industrial competitiveness.
International experience shows that protectionism over industrial raw materials can yield the exact opposite of the intended effects. In the United States, tariffs on steel and aluminium were framed as a tool for industrial revitalisation. Yet various economic studies demonstrated that the benefits to steel production were limited, while the costs trickled down significantly into the industries that use these materials. When you drive up the cost of an input used across thousands of companies, the effect does not remain confined to the protected sector. It ripples through the entire economy.
Europe cannot afford to repeat mistakes that have already been tested in other markets.
The core question is this: Do we want to build competitiveness, or merely manage decline? Do we want a genuine industrial policy, or a succession of defensive measures lacking a systemic vision?
The answer must be clear. Europe needs to safeguard its industrial base, but that protection must be tied to a competitiveness agenda. Any safeguard measure must come with counter-commitments, objectives, and metrics. It must create the conditions for investment, modernisation, and cost reduction, not just sustain higher prices. It must be temporary, demanding, and accompanied by structural reforms.
Five Key Priorities for European Industry
- First, it is vital to guarantee competitive energy for European industry. There is no green steel, no green chemicals, no circular packaging, and no reindustrialisation without abundant, clean energy at predictable prices. Climate policy will only be socially and economically sustainable if it remains compatible with industrial production on European soil.
- Second, Europe must slash its red tape. Industrial companies do not become competitive by filling out forms. Competitiveness comes from producing better with fewer resources, less waste, and greater value.
- Third, trade measures must take the entire value chain into account. If Europe protects steel, it must ensure it does not disproportionately harm the sectors that process it. Policy must look at the complete ecosystem: raw materials, processing, packaging, logistics, clients, and consumers.
- Fourth, the European Union must accelerate its support instruments for productive investment. Industrial decarbonisation is highly capital-intensive. If Europe wants clean, automated, and competitive factories, it must create simple, rapid, and predictable mechanisms to support this transformation. Strategic ambitions are not enough; we need actionable tools.
- Finally, Europe must have the courage to measure the real-world impact of its decisions. A policy that makes industrial inputs more expensive must be evaluated not just by its effect on the protected sector, but also by its impact on employment, exports, producer price inflation, investment retention, and overall value chain resilience.
I believe deeply in Europe. I believe in its values, its social model, its environmental ambition, and its technological capability. But these values cannot be sustained by regulation or protection alone. They are sustained by a strong, productive economy capable of competing on the global stage.
Without industry, Europe becomes more dependent on imports. Without competitiveness, it becomes more vulnerable. Without productive investment, the green transition risks becoming a mere transfer of emissions and jobs outside the European Union.
Protecting European industry is necessary. But protecting it poorly can be worse than not protecting it at all. Europe does not need to drive downstream manufacturing away in the name of protecting steel, solving one problem by creating an even greater contradiction. It needs to create the conditions for producing in Europe to become a competitive advantage once again, ensuring that our trade measures strengthen rather than weaken the very sectors driving our economic and environmental future.