Brussels rallies heavy industry behind 'Made in Europe' production drive

2026-01-17 hardware

Brussels, Saturday 17 January 2026
Ahead of the imminent Industrial Accelerator Act, the European Commission is urgently lobbying executives to back a French-led “Made in Europe” mandate. With a record €350 billion trade deficit with China in 2025, Brussels is pivoting from established free-trade norms to aggressive industrial policy. The proposed strategy seeks to lock in domestic production targets of 60% to 80% and may condition foreign investments over €100 million on technology sharing and local hiring. As Vice-President Stéphane Séjourné warns of a potential erosion of economic sovereignty, this push for strategic autonomy faces scrutiny from member states concerned about protectionism and single market integrity.

A Pivot from Free Trade to Strategic Sovereignty

The urgency of this shift is underscored by Executive Vice-President Stéphane Séjourné, who has framed the current economic landscape as a “return of power-based economic relations”. He argues that without a pragmatic industrial policy, the bloc faces a gradual erosion of its “know-how and economic sovereignty” [1][7]. This rhetoric marks a significant departure from the free-trade philosophy that has historically underpinned EU policy, moving instead towards a model where local companies are prioritised in investment decisions [2][3]. The Commission is reportedly exploring mechanisms to link EU funding, specifically the Multiannual Financial Framework (MFF) and the Competitiveness Fund, directly to this initiative to ensure that public money supports European production [1][7].

Engineering a Sovereign Supply Chain

Central to the upcoming legislation—scheduled for presentation on 29 January, though delays remain possible—is the establishment of ‘lead markets’ designed to stimulate demand for sustainable, low-carbon industrial products [1][7]. The draft Industrial Accelerator Act (IAA) proposes strict conditions for foreign investments exceeding €100 million ($116 million) [2]. These mandates would require foreign entities to share technologies, hire local workers, and establish joint ventures with European firms [2][3]. Furthermore, the legislation aims to address vulnerabilities in critical supply chains by proposing ‘stockpiling centres’ for imported critical raw materials and introducing a ‘green label’ for steel to differentiate European output [3][5].

The Friction Between Protection and Competitiveness

While the initiative aims to bolster European resilience, it has exposed deep rifts within the bloc. A coalition of nine member states, including Czechia, Finland, Ireland, and Sweden, warned in December 2025 that such measures could severely impact “effective competition, price and quality levels” [1][7]. Poland and the Netherlands have specifically requested an impact assessment, fearing that the drive for autonomy might inadvertently undermine the Single Market [7]. Conversely, labour representatives argue that a ‘Buy European’ strategy must transcend mere production metrics. The European Trade Union Confederation (ETUC) insists that public support must be conditional on the creation of quality jobs and adherence to collective bargaining rights, ensuring that the transition to green and digital economies benefits the workforce rather than solely protecting corporate profits [4].

Sources & Ecosystem Partners

Industrial policy Manufacturing