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EU pushes strategic industry plan, weighing retaliation risks

Rabobank economists said EU proposals, including expanded trade-defence options, are expected this autumn but could take time to agree and implement.

Reported · Written up by our desk · Central Banks

FXStreet, citing RaboResearch economists Maartje Wijffelaars and Leander Kalff, said the European Union is intensifying efforts to strengthen Eurozone industry and reduce external dependencies.

The report outlines measures intended to stimulate strategic sectors, raise trade-defence barriers, and diversify supply chains, while flagging risks from potential US and Chinese retaliation and internal EU divisions that could slow implementation.

RaboResearch tied the pressure on European industry to factors including competition from China, high energy prices, and the short term costs of decarbonisation, which it said weigh on both current and longer term growth.

While the EU wants to remain an open economy and prefers dialogue, the economists said the European Commission and member states are also exploring greater use of trade-defence measures, with proposals expected this autumn.

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