More than 2,000 jobs are at risk as British Steel, the UK’s second-largest steelmaker, announced plans to shut down its blast furnaces and steelmaking operations in Scunthorpe. The decision follows failed negotiations between the company’s Chinese owner, Jingye, and the UK government over a financial support package.

Unions Call for Government Intervention

Unions have urged the government to step in and secure the future of British Steel, which has been incurring daily losses of around £700,000 (€840,000). Since acquiring the company in 2020, Jingye has invested over £1.2 billion to sustain operations but cited “highly challenging market conditions, tariffs, and rising environmental costs” as key reasons for the decision to shut down primary steel production.

British Steel is currently consulting with unions on the closures and potential reductions in rolling mill capacity, which could take effect as early as June. Between 2,000 and 2,700 jobs are at stake.

Failed Rescue Talks and Calls for a Green Transition

The company had sought government support for a significant investment in two new electric arc furnaces, which would reduce carbon emissions compared to traditional blast furnaces. However, after months of negotiations, no agreement was reached.

Unions had proposed a transition plan to decarbonize steelmaking, advocating for continued operation of the existing blast furnaces while the new electric furnaces were being built. This strategy would require an additional £200 million in government support to offset carbon costs during the transition period.

“This is a dark day for our steel industry and our country,” said Roy Rickhuss, General Secretary of the Community union. “The closures at Scunthorpe would be a hammer blow to communities built on steel, where thousands of jobs—both directly and in the supply chain—depend on this industry.”

Rickhuss urged both the government and Jingye to resume negotiations, emphasizing that the company has not ruled out keeping the blast furnaces operational during a transition if government support is secured.

Government Response

Business and Trade Secretary Jonathan Reynolds stated that the government remains committed to finding a solution. “We’ve been clear there’s a bright future for steelmaking in the UK, and we will continue working tirelessly to reach an agreement,” he said.

Decline of the UK Steel Industry

Once a global leader, British steel production employed over 300,000 people in the postwar era. However, competition from cheaper steel imports, particularly from China, has significantly reduced its footprint. Today, the industry employs around 40,000 people, contributing just 0.1% to the UK economy.

With uncertainty looming over the future of British Steel, industry leaders and unions continue to push for a government-backed strategy to secure jobs and ensure the long-term sustainability of steel production in the UK.

Global markets were rattled after US President Donald Trump announced a 25% tariff on all imported automobiles, set to take effect next week, with auto parts tariffs following on May 3, 2025. The move has drawn widespread condemnation from European industry leaders, who warn of supply chain disruptions, increased costs, and potential job losses.

White House Justifies Tariffs on National Security Grounds

The White House defended the tariffs, citing national security concerns. In an official statement, the administration claimed that foreign automobile imports threaten the US industrial base and necessitate protective measures.

“I find that imports of automobiles and certain automobile parts continue to threaten to impair the national security of the United States and deem it necessary and appropriate to impose tariffs,” the statement read.

Europe Reacts Strongly

European leaders and industry groups swiftly condemned the tariffs. German Economy Minister Robert Habeck called for a decisive European response, stating, “The EU must now give a firm response to the tariffs—it must be clear that we will not back down in the face of the USA.”

The German Association of the Automotive Industry (VDA) also criticized the decision, warning that it could disrupt supply chains and harm economic growth. Hildegard Müller, VDA President, called the tariffs “a disastrous signal for free, rules-based trade” and urged urgent US-EU negotiations to prevent further escalation.

Impact on German-U.S. Trade Relations

Germany’s automotive industry maintains strong ties with the US, employing around 138,000 American workers, including 48,000 in manufacturing and 90,000 in parts supply. Nearly half of the more than 900,000 vehicles produced by German automakers in the US are exported globally.

A VDA survey found that 86% of medium-sized automotive firms expect to be affected by the tariffs—32% directly and 54% indirectly through supply chains. The European Automobile Manufacturers’ Association (ACEA) added that the tariffs come at a critical time for an industry transitioning toward electrification and sustainability.

“European automakers have been investing in the US for decades, creating jobs and fostering economic growth,” said Sigrid de Vries, Director General of ACEA. She urged immediate dialogue between the US and EU to avoid a full-scale trade war.

Analysts Warn of Price Hikes and Earnings Pressure

Financial analysts cautioned that the tariffs could significantly raise vehicle prices for US consumers. Goldman Sachs analyst Mark Delaney estimated that imported car prices could increase by $5,000 to $15,000 (€4,600–€13,800), while US-assembled models may see cost hikes of $3,000 to $8,000 (€2,800–€7,400) due to reliance on imported parts.

Delaney noted that Tesla and Rivian, which manufacture entirely in the US, would be less affected. Ford and General Motors, which produce 80% and 60–70% of their US sales volume domestically, respectively, could still face challenges due to global supply chain complexities. European automakers like Volvo Cars and Porsche are expected to be the hardest hit.

Stock Markets React

The announcement triggered a sharp sell-off in auto stocks. Porsche AG saw its shares drop 5.4%, while Mercedes-Benz AG fell 4.8%, Ferrari declined 4.7%, BMW AG slipped 3.7%, and Volkswagen AG lost 2.9%.

US automakers were also impacted, with General Motors falling 7%, Ford declining 3.7%, and Tesla slipping 1.7% in premarket trading. Analysts predict continued volatility as the industry assesses the full impact of the tariffs.

With tensions escalating, industry leaders on both sides of the Atlantic are urging swift negotiations to prevent further economic fallout.

Spain’s economy expanded by 3.2% in 2024, making it one of the fastest-growing economies in the eurozone. Strong domestic demand, a thriving tourism sector, and the continued rollout of European recovery funds drove the country’s robust performance, outpacing major economies like Germany, France, and Italy. Economists expect Spain’s economic momentum to carry into 2025, maintaining its position as a “bright spot” in Europe.

Strong Economic Expansion

Spain’s GDP grew by 0.8% in the fourth quarter of 2024, according to the National Statistics Institute (INE), bringing full-year growth to 3.2%. This figure is more than three times the eurozone’s average growth of 0.9%. Among eurozone nations, only Malta (6%), Croatia (3.8%), and Cyprus (3.4%) recorded stronger growth.

In contrast, Germany’s economy shrank by 0.2%, while France and Italy registered modest growth of 1.1% and 0.7%, respectively.

The Spanish economy benefited from a mix of structural improvements and favorable economic conditions. Key growth drivers included resilient household spending, a booming tourism industry, and effective use of EU recovery funds.

Drivers of Growth

Domestic demand played a crucial role in Spain’s expansion, contributing 3.6 percentage points to overall GDP growth. Household consumption rose by 1%, while investment surged by 2.9%. Public expenditure also increased by 0.3%. However, external demand remained weak, as imports (+1.4%) outpaced sluggish exports (+0.1%), creating a slight drag on overall growth.

Across industries, most sectors saw gains. The construction sector grew by 2.7%, services by 1.0%, and manufacturing by 0.5%. Only the primary sector, which includes agriculture and fishing, experienced a decline of 0.7%.

Tourism Fuels Economic Strength

Spain’s tourism sector continued its strong recovery, welcoming an estimated 94 million international visitors in 2024—a 10% increase from the previous year. Economist Judit Montoriol Garriga from CaixaBank Research noted that the sector showed “no signs of cyclical exhaustion,” with tourism-related GDP projected to rise by 3.6% in 2025. The industry’s growing contribution to Spain’s economy is expected to reach 13.2% of GDP, up from 12.9% in 2024.

The tourism sector’s success has significantly benefited related industries, including retail, hospitality, and transport services.

Outlook for 2025: Continued Growth, but Slower Pace

Spain’s economic growth is expected to moderate in 2025, though it is likely to remain one of the strongest performers in the eurozone. The Organisation for Economic Co-operation and Development (OECD) forecasts a 2.6% GDP increase for Spain, compared to projected growth of just 0.4% in Germany, 0.8% in France, and 0.7% in Italy.

Montoriol Garriga anticipates 2.5% growth in 2025, driven by factors such as falling interest rates, higher household purchasing power, and continued EU recovery fund disbursements. The latest outlook from BBVA also suggests that Spain and Portugal will continue to outperform core eurozone economies.

Inflation and Economic Stability

Inflation remains relatively stable in Spain. Harmonized consumer prices rose by 2.9% year-on-year in February 2025, with core inflation—excluding volatile energy and food prices—easing to 2.1%, close to the European Central Bank’s 2% target. However, some economists warn that rising producer prices, which surged 6.6% year-on-year in February, could push consumer prices higher in the coming months.

Recovery Funds Continue to Support Growth

Spain has benefited significantly from the European Union’s NextGenerationEU (NGEU) recovery program. By the end of 2024, the country had allocated €47.6 billion in grants and tenders, representing about 60% of the total grant package. In December 2024, Spain requested an additional €8 billion in grants and €15.9 billion in loans from the European Commission.

According to a Bank of Spain survey, nearly half (45%) of Spanish companies stated they would not have made their investments without NGEU funding, highlighting the program’s role in supporting economic expansion.

Labour Market and Housing Sector

Spain’s labor market remained strong in 2024. The unemployment rate fell to 10.61% in the fourth quarter, marking its lowest level since 2008. Total hours worked increased by 2.8% year-on-year, while full-time equivalent employment grew by 2.3%.

Meanwhile, the housing market continued to show resilience. Home prices rose by 5.8% in 2024 and are expected to increase by 5.9% in 2025. Transaction prices climbed by 8.4% last year, with further growth anticipated.

Spain’s Economic Outlook Remains Positive

Despite expectations of a slowdown from 2024’s rapid pace, Spain’s economy is likely to remain one of the eurozone’s strongest performers in the coming years. The OECD projects 2.1% growth for Spain in 2026—nearly double the forecasted growth rates for Germany, France, and Italy.

With a robust domestic economy, a thriving tourism sector, and continued investment from EU recovery funds, Spain’s post-pandemic economic expansion appears set to continue well into the future.