Industrial Strategy: "The EU Commission is forgetting the skilled trades"

The EU Commission has revised its industrial strategy to prepare the economy for digital and ecological transformation. The proposed measures leave the skilled crafts sector out of the equation, criticizes the ZDH.

This article is part of the special feature "How Brussels interferes in day-to-day business operations".

The European Commission has presented its revised EU industrial strategy . It aims to improve the EU's ability to respond to future crises following the COVID-19 pandemic. The strategy is designed to prepare the economy for the digital and green transitions and ensure its continued competitiveness.

"This now requires new investments in people, in technologies, and in the right regulatory framework that guarantees fairness and efficiency," says Commission Vice-President Margrethe Vestager . The pandemic has exposed dependencies in key strategic areas such as semiconductors, raw materials, and pharmaceutical ingredients, which should be overcome, among other things, through industry alliances.

Accelerate economic recovery

In light of the coronavirus crisis, the strategy aims to accelerate economic recovery and strengthen the EU's strategic autonomy . Previously established priorities remain unchanged. The proposed measures are designed to make the single market more resilient, even in times of crisis.

The updated strategy aims to identify and monitor the key indicators of the competitiveness of the EU economy , including internal market integration, productivity growth, international competitiveness, and public and private investment and research and development investment.

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Supporting SMEs and start-ups

The so-called SME dimension is intended to be a core element of the new strategy, ensuring needs-based financial support . According to the Commission, it includes measures that will enable small and medium-sized enterprises (SMEs) and start-ups to manage the dual transition.

"The single market has been severely tested by supply restrictions, border closures and fragmentation resulting from the coronavirus pandemic ," the Commission stated. The crisis has clearly demonstrated that the free movement of people, goods, services and capital within the single market must be maintained and that the market should be less susceptible to disruption.

Key areas of the strategy

The Commission wants to:

• Put forward a proposal for an emergency instrument for the internal market, thus providing a structural solution for the future to ensure the free movement of people, goods, and services in the event of a crisis. It should guarantee greater transparency and solidarity and help eliminate critical product shortages by accelerating their availability and strengthening cooperation in public procurement;
• fully enforce the Services Directive to ensure that Member States effectively comply with their existing obligations, including the obligation to notify in order to identify and remove potential new restrictions;
• improve product market surveillance by supporting national authorities in increasing capacity and advancing digitalisation in product controls and data collection;
• mobilise significant investments to support SMEs and design and implement alternative dispute resolution mechanisms to address late payments to SMEs and provide measures to address solvency risks for SMEs.

The pandemic has greatly accelerated the ecological and digital transitions. Therefore, the Commission is responding with new measures :

• Jointly design transition pathways in consultation with industry, public authorities, social partners, and, where appropriate, other stakeholders, initially from the tourism and energy-intensive industries. This could make it possible to provide a more precise, bottom-up understanding of the scope, costs, and requirements of the measures needed to accompany the dual transition for the most relevant ecosystems, resulting in an implementable plan to promote sustainable competitiveness.
• Create a coherent legal framework to achieve the objectives of Europe's Digital Decade and the Fit for 55 package, including by accelerating the deployment of renewable energy sources and ensuring access to abundant, affordable and low-carbon electricity;
• To make the most of the ecological and digital transition, provide SMEs with sustainability advisors and promote data-driven business models;
• Invest in upskilling and reskilling to support the dual transition.

The Commission intends to deal with the EU's strategic dependencies as follows:

• The Commission carried out a bottom-up analysis based on trade data: out of 5200 products imported into the EU, an initial analysis selected 137 products (representing 6 percent of the total value of goods imported into the EU) in vulnerable ecosystems where the EU has a high level of dependency, particularly in the ecosystems of energy-intensive industries (such as raw materials) and health (such as active pharmaceutical ingredients). Other products important for supporting the green and digital transition were also examined. For 34 products (representing 0,6 percent of the total value of goods imported into the EU), the vulnerability may be higher, as these products may have little potential for further diversification and substitution with EU products. The analysis also highlights the challenges and dependencies in the area of ​​advanced technologies;
• the Commission presents the results of six in-depth reviews on raw materials, batteries, active pharmaceutical ingredients, hydrogen, semiconductors, and cloud and advanced technologies, which provide additional insight into the origins of strategic dependencies and their impact;
• the Commission will carry out a second round of reviews of potential dependencies in key areas, including products, services or technologies that are central to the twin transition, such as renewable energy, energy storage and cybersecurity, and develop a monitoring system with the help of the Commission's Critical Technologies Observatory;
• the Commission is working to diversify international supply chains and foster international partnerships to improve threat preparedness;
• The Commission supports new industrial alliances in strategic areas where such alliances represent the best tool for accelerating activities that would otherwise be impossible to develop. Industrial alliances will be promoted where private investors are encouraged to discuss new business partnerships and models openly, transparently, and in a competitive manner, and where there is potential for innovation and the creation of high-quality jobs. Alliances offer a broad and fundamentally open platform, with particular attention paid to their inclusivity for start-ups and SMEs.

"It is right that the EU Commission is proposing a strategy for Europe with the necessary economic policy measures to support the reconstruction after the Corona pandemic," says Holger Schwannecke , Secretary General of the Central Association of German Crafts.

Holger Schwannecke Photo: © ZDH / Schuerring

For reconstruction can only succeed with a successful economic policy . However, the proposals and measures outlined in the now-published industrial strategy are focused on industry in the narrow sense and neglect other sectors of the economy , even though the word "industry" in English usage refers to the entire manufacturing sector , including crafts .

No concrete measures for the craft sector

"However, concrete measures for craft businesses are lacking. A truly sustainable recovery can only be achieved in cooperation with the craft sector . This requires a dedicated SME policy at the European level. This policy must include appropriately differentiated and concrete approaches to action ," demands Schwannecke.

The skilled trades need access to data via open interfaces to create a tailored service offering for customers from a range of industrially manufactured and standardized products . The broad innovative capacity of the skilled trades should be utilized in the development of the proposed 14 economic sectors.

Sources: EU Commission / ZDH