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EU Unveils Industrial Plan to Prioritise European Production and Limit Chinese Access
The European Commission has presented a sweeping industrial strategy aimed at shielding key sectors from foreign competition and limiting China’s access to EU public funding and investment opportunities.
EU Industry Commissioner Stéphane Séjourné unveiled the Industrial Accelerator Act in Brussels on Wednesday, describing it as a response to mounting global uncertainty and what he called unfair competition. The plan introduces a “European Preference” designed to direct taxpayer-funded support toward companies producing within the bloc.
The initiative follows significant job losses across Europe’s manufacturing base. Since 2024, around 200,000 jobs have been lost in energy-intensive industries and the automotive sector. Projections suggest up to 600,000 additional losses in car manufacturing over the coming decade, as Chinese exports increase and foreign-owned plants generate limited local employment.
The strategy focuses on three strategic sectors: clean technologies, automotive manufacturing and energy-intensive industries such as aluminium, steel and cement. Under the new framework, products benefiting from EU public funding will need to meet “Made in Europe” thresholds. Electric vehicles must contain at least 70 percent EU content, with some exceptions for battery components. Aluminium and cement products will be subject to a 25 percent EU-content requirement.
Séjourné said the measures would strengthen supply chains, reduce dependencies and enhance economic security. He argued the plan would create jobs by ensuring public money supports domestic production.
The proposal has exposed divisions among member states. Nordic and Baltic countries cautioned that stricter rules could deter investment and restrict access to foreign technology. Germany advocated allowing goods from trusted trade partners to qualify under the European label, while France supported a tougher stance.
The Commission has proposed that products from countries with reciprocal free trade agreements with the EU could be treated as EU-origin in public procurement. This would exclude China and the United States, which do not have such agreements with the bloc.
Stricter conditions are also planned for foreign direct investment exceeding €100 million in sectors including batteries, electric vehicles, solar panels and critical raw materials. Investors from countries holding 40 percent of global market share in a given sector would be required to ensure at least half of jobs go to EU workers. Additional conditions include limits on foreign ownership, joint ventures with European partners, technology transfers and commitments to research and development within the bloc.
The proposal will now move to the European Parliament and the Council for approval as debates continue over how best to balance openness with industrial protection.
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