France advocates for the EU to respond to American subsidies for ‘green’ investments with an industrial strategy to prevent companies from leaving Europe and reduce member states’ dependence on external suppliers, as shown in a government document from Paris.
“Therefore, the implementation of an ambitious and strong European industrial policy is crucial today, and the French government proposes that it be shaped as a ‘Made in Europe’ strategy,” states France in the document reviewed by Reuters.
Paris calls for urgent measures in the document, primarily to retain European companies in the sectors of solar panels, batteries, hydrogen, and critical raw materials, emphasizing that the ‘Made in Europe’ strategy should be based on four pillars.
The first pillar would be specific EU targets for reducing dependence on external suppliers and establishing production goals by 2030 in key sectors that would be regulated by EU laws, modeled after the European Chips Act.
The EU would also need to simplify and expedite the issuance of permits for new manufacturing facilities and restructure the energy market to ensure European companies have access to energy at affordable prices, suggests France.
The second pillar would be an urgent change in state aid regulations to allow for a time-limited extension of crisis pandemic incentives for companies in targeted sectors.
States would assist companies with subsidies or tax breaks to provide them with security in making investment decisions.
The third pillar would be European financing for sensitive sectors to neutralize differences in fiscal capacities among EU countries. At the Union level, a fund could be established that would borrow favorably and allocate money in the form of cheap loans to member states.
Paris has also proposed the establishment of a ‘crisis fund’ and the repurposing of money that the EU has decided to raise for other purposes, directing it towards strategic projects for European industry, in addition to state aid at the country level.
Finally, the EU should establish a new ‘stabilization fund’ by the end of the year that would take over the resources of the emergency fund and assist sensitive sectors.
The last pillar of the strategy would be a fully mobilized trade policy, including recent trade protection instruments, Paris proposes in the document.
