The organization supports prioritizing low-carbon products manufactured in Europe under the “Made in Europe” approach, while emphasizing that local content requirements should cover not only finished products but also the components used in production.
ARGEZ said the European Commission’s Industrial Accelerator Act sends a strong message in favor of a new, strategically focused European industrial policy. The regulation aims to strengthen the EU’s industrial base, increase production capacity and accelerate decarbonization in key sectors.
The organization highlighted the importance of the initiative’s timing given geopolitical uncertainties, supply chain dependencies and comprehensive industrial policies being implemented in the United States and China. At the same time, it stressed that preference rules should form part of a comprehensive industrial policy, with the primary objective of maintaining the competitiveness of European industry.
Increase in imports of automotive parts from China highlighted
ARGEZ said free and rules-based global trade remains a key element of the success of German industry, but noted that trade defense measures are also needed under current conditions.
According to the organization, EU imports of automotive parts from China have doubled since 2019, while EU exports to China have increased only marginally. It added that the United States’ use of import tariffs as a trade policy tool in line with its political objectives is increasing pressure on European producers.
Under these circumstances, ARGEZ argued that trade defense instruments, such as systems that prioritize European production, are necessary provided that they are appropriate and proportionate.
Steel and aluminum among strategic sectors
According to ARGEZ, the IAA also represents a commitment to the “Made in Europe” strategy. It envisages prioritizing products manufactured in Europe with low carbon emissions in public procurement and public financing.
The organization said that, if implemented correctly, this approach could strengthen value added and employment in Europe while accelerating the transition to a climate-neutral economy. It added that retaining technological know-how in Europe would contribute to the continent’s resilience.
The new public procurement criteria are expected to support strategic sectors including steel, aluminum, rubber, automotive manufacturing and future technologies.
ARGEZ also said local content requirements are an important tool for an effective “Made in Europe” policy, arguing that such requirements should apply not only to the finished product but also at the component level in order to preserve a large share of the value added generated in Europe.
ARGEZ: Implementation should involve minimal bureaucracy
ARGEZ emphasized that the EU’s rules on preferential treatment should be implemented in a practical manner with bureaucracy kept to a minimum.
According to the organization, the IAA can succeed only if it is designed with minimal bureaucracy, is practical to implement and achieves its stated objectives. ARGEZ said local content requirements should be realistic and workable, and called for the opportunities offered by digital supply chains already used in the automotive sector to be leveraged.
ARGEZ also stated that “trust should take precedence over control in cases of doubt.”
Conditional approach to granting EU-origin status to third-country products
Another issue highlighted by ARGEZ was how EU origin should be defined. The organization said that for the European preference system to be effective, EU origin should be determined in a way that reflects the value added created within the bloc.
According to ARGEZ, the fact that a country has a free trade agreement or customs union with the EU, or has made commitments concerning public procurement, should not in itself be sufficient for products from that country to be automatically treated as equivalent to EU-origin products.
If such status is granted to third-country products, ARGEZ said clear conditions compatible with World Trade Organization (WTO) rules should apply, including reciprocity, equivalent CO₂ costs and sustainability standards.
ARGEZ represents around 9,000 supplier companies, predominantly small and medium-sized enterprises. The companies represented by the organization employ approximately 1 million people and have a combined turnover of around EUR 244 billion.
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