Investing in Europe’s industrial base has never been more urgent. The current context is marked by profound uncertainty: energy-intensive sectors continue to grapple with high energy prices, geopolitical instability, and intensifying global competition. The ongoing conflict in the Middle East has further exposed the vulnerabilities of European industrial supply chains and energy systems.
On 19-20 March, EU leaders will meet at the European Council to address a wide agenda, including the next EU budget, the crisis in the Middle East, the situation in Ukraine, as well as key issues such as competitiveness, EU resilience, and industrial policy. Yesterday, the European Commission announced it will explore loosening State aid rules to help Member States manage the energy crisis triggered by the war in the Middle East, according to a letter sent by Commission President Ursula von der Leyen.
At the same time, the EU is engaging in a critical debate on industrial policy, driven by discussions around the Investment Acceleration Act and the broader “Made in Europe” agenda. Social and local content conditionalities remain essential for any public support to industry.
Since the CISAF was adopted, twelve[CF1.1] national State aid schemes have already been notified and approved by the European Commission. These schemes come from countries including France, Spain, Greece, Italy, Hungary, Germany and Austria, and target a wide range of objectives such as manufacturing capacity in clean technologies, decarbonisation projects, strengthening industrial value chains for clean-tech components, regional industrial development (for example in Lazio and Emilia-Romagna), renewable energy manufacturing, including wind energy. Public support takes multiple forms: direct grants, subsidised loans and tax reductions.
The scale of public funding involved is significant. Yet the Commission’s assessments and justifications for approving these schemes have sometimes been extremely brief, especially given the amounts of public money at stake. In some cases, transparency appears insufficient, and we have asked the Commission for further clarifications. For example, one Spanish scheme on clean tech manufacturing was recently approved through a decision not to raise objections, but without any substantive public information about the measure itself. When billions of euros in public resources are mobilised, citizens and workers have the right to know how and why these funds are allocated.
Another concerning aspect is how the Commission evaluates non-delocalisation criteria. In our position paper (link), we regretted the lack of a genuine strategy for the relocation of industry and the preservation of jobs. In the CISAF, these conditions are weak and difficult to verify[CF2.1]. We regret that the Commission is not introducing a more robust mechanism to prevent relocations. In one of the latest cases involving a scheme estimated at €1.1 billion in France, French authorities are only required to provide a sworn statement confirming beneficiary will not relocate activities. Such a declaration offers very weak guarantees that public support will actually strengthen Europe’s industrial base.
“If public funds are used to support strategic industries, they must come with strong safeguards to protect jobs, workers’ rights, and local value creation in Europe. Taxpayer-funded industrial support should require clear commitments on quality employment, social dialogue, skills development, and long-term investment in Europe.” said Judith Kirton-Darling, industriAll Europe's general secretary.
Another problematic limitation is that undertakings in difficulty are excluded from support. This approach risks undermining industrial resilience precisely where it is most needed. The case of companies like Northvolt illustrates the challenge: strategic projects may face financial difficulties during the transition, yet the current framework leaves little room to support them in ways that preserve industrial capacity and employment.
Europe’s industrial policy must put workers at its heart. Public investment cannot be a blank cheque. It should come with transparency, safeguards, and social conditions that ensure quality jobs, resilient supply chains, and a just green transition in Europe. Profit-sharing and clawback mechanisms are essential so that both the risks and benefits of State aid are shared. Only by combining industrial decarbonisation, strategic resilience, and strong social commitments can Europe build a competitive and worker-centered industrial future.