Brussels, 11 October 2012

European Industrial Policy – post rhetoric action

Yesterday, the European Commission has given a clear signal to Europe’s manufacturing industry by issuing its Communication on Industrial Policy “A Stronger European Industry for Growth and Economic Recovery” that there is more than just rhetoric following President Barroso’s recent ‘State of the Union’ address.

This is a welcome change: for the last months Europe’s focus has been on re-establishing budgetary orthodoxy, essentially through the introduction of austerity measures. Such an approach, while necessary, is clearly not sufficient: for austerity to be acceptable to citizens, it needs to be accompanied by hopes of better times ahead, which only growth can provide. We therefore very much welcome the Commission’s Communication which stresses that industry is vital to the economic recovery and has clear focus on manufacturing, growth and job creation.

In particular, we welcome the recognition that the manufacturing sector – specifically engineering – has a key role to play in assisting Europe to emerge from the current economic crisis in a stronger position than ever, thereby maintaining the industry’s traditionally powerful position within the global economy. Adrian Harris, Director General of Orgalime commented “It is good to see that at last the European Commission has reacted to the real needs of the economy by re-establishing a clear focus on manufacturing, growth and job creation. Moreover the setting of a new 20% target for industry in relation to GDP should serve to focus the minds of policymakers on what is a core truth: that manufacturing is vital to Europe’s economic recovery and future. It is time that the EU worked on getting the right framework conditions in Europe to attract industrial investment.”

Additionally, Orgalime are pleased to see the importance given to engineering issues in the priority action lines, with a focus on advanced manufacturing technologies for clean production, Key Enabling Technologies, clean vehicles and their infrastructures, as well as smart grids. The focus on the internal market which has long underpinned the success of the engineering industry, on finance, on research, development and innovation (including on the support for public private partnerships such as “the Factories of the Future PPP”), on education and skills, as well as on trade are also key elements of the framework conditions that Orgalime agrees are needed to boost

manufacturing investment in the industry.

Added Adrian Harris: “in recent years the EU has developed a maze of policies and regulation, which are unstable, complex and often even not coherent. As a result, the internal market has progressively been undermined; this coupled with the stronger growth in many overseas markets has effectively led to the EU being considered as less attractive by industrial investors. Now let us hope that the EU institutions, led by the European Commission will at last focus on achieving and applying coherent policy and regulation which once again attract manufacturing investment in practice: the success or failure of this policy will have a lasting impact on Europe and our position in the world.”

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Orgalime, the European Engineering Industries Association, speaks for 37 trade federations representing some 130,000 companies in the mechanical, electrical, electronic, metalworking & metal articles industries of 22 European countries. The industry employs some 10.2 million people in the EU and in 2011 accounted for some €1,666 billion of annual output. The industry not only represents some 28% of the output of manufactured products but also a third of the manufactured exports of the European Union.