Key Messages
We are a significant part of the export industry, and succeeding in international competition requires continuous transformation toward sustainability. To ensure competitiveness, we need robust industrial policies both in Finland and the EU that support fair competition and pioneers. This is a critical prerequisite for realizing investments aimed at transformation. Accelerating emissions reductions in European industry should not lead to an escalation of state aid competition.
Specialization and the production of environmentally advanced products provide growth and competitiveness. Therefore, it is essential to minimize the risk of carbon leakage through a well-functioning carbon border adjustment mechanism. At the same time, the EU must actively protect itself against unfair competition and utilize trade defense mechanisms whenever necessary. Structural issues, such as subsidized overcapacity and overproduction of raw materials and processed goods, particularly in China, perpetuate unfair competition. Finland’s and the EU’s dependency on imported raw materials highlights the importance of securing the availability of metals for the continuity of operations.
Policy Directions
- The implementation of industrial policy must strengthen the competitiveness of the value chain for low-carbon and sustainably produced metals.
- A consistent transition to low-carbon solutions requires an increase in the supply and use of low-carbon-produced metals, alongside improvements to the Carbon Border Adjustment Mechanism (CBAM) to prevent circumvention.
- Fair competition should provide a competitive edge to pioneers. Faster and stronger WTO-compatible measures are needed to protect against unfair competition and prevent circumvention of trade defense measures as part of EU trade policy.
- The implementation of the EU Critical Raw Materials Act must continue decisively, enhancing security and self-sufficiency by reducing the EU’s dependency on raw materials from outside the bloc.
Key EU Initiatives and Reforms
- Clean Industrial Deal (including the new state aid framework)
- European Competitiveness Fund
- Important Projects of Common European Interest (IPCEI)
- Steel and Metals Action Plan
- Decarbonization Accelerator Act
- New Foreign Economic Policy / EU Trade Policy
- Clean Trade and Investment Partnerships
- Aggregated Demand Mechanism (for hydrogen and critical raw materials)
- Public Procurement Directive (Single Market for Sustainable Products)