Europe’s chemical industry has reached a breaking point. The warning lights are no longer blinking — they are blazing. Unless Europe changes course immediately, we risk watching an entire industrial backbone, with the countless jobs it supports, slowly hollow out before our eyes. Consider the energy situation: this year European gas prices have stood at 2.9 times higher than in the United States. What began as a temporary shock is now a structural disadvantage. High energy costs are becoming Europe’s new normal, with no sign of relief. This is not sustainable for an energy-intensive sector that competes globally every day. Without effective infrastructure and targeted energy-cost relief — including direct support, tax credits and compensation for indirect costs from the EU Emissions Trading System (ETS) — we are effectively asking European companies and their workers to compete with their hands tied behind their backs. > Unless Europe changes course immediately, we risk watching an entire > industrial backbone, with the countless jobs it supports, slowly hollow out > before our eyes. The impact is already visible. This year, EU27 chemical production fell by a further 2.5 percent, and the sector is now operating 9.5 percent below pre-crisis capacity. These are not just numbers, they are factories scaling down, investments postponed and skilled workers leaving sites. This is what industrial decline looks like in real time. We are losing track of the number of closures and job losses across Europe, and this is accelerating at an alarming pace. And the world is not standing still. In the first eight months of 2025, EU27 chemicals exports dropped by €3.5 billion, while imports rose by €3.2 billion. The volume trends mirror this: exports are down, imports are up. Our trade surplus shrank to €25 billion, losing €6.6 billion in just one year. Meanwhile, global distortions are intensifying. Imports, especially from China, continue to increase, and new tariff policies from the United States are likely to divert even more products toward Europe, while making EU exports less competitive. Yet again, in 2025, most EU trade defense cases involved chemical products. In this challenging environment, EU trade policy needs to step up: we need fast, decisive action against unfair practices to protect European production against international trade distortions. And we need more free trade agreements to access growth market and secure input materials. “Open but not naïve” must become more than a slogan. It must shape policy. > Our producers comply with the strictest safety and environmental standards in > the world. Yet resource-constrained authorities cannot ensure that imported > products meet those same standards. Europe is also struggling to enforce its own rules at the borders and online. Our producers comply with the strictest safety and environmental standards in the world. Yet resource-constrained authorities cannot ensure that imported products meet those same standards. This weak enforcement undermines competitiveness and safety, while allowing products that would fail EU scrutiny to enter the single market unchecked. If Europe wants global leadership on climate, biodiversity and international chemicals management, credibility starts at home. Regulatory uncertainty adds to the pressure. The Chemical Industry Action Plan recognizes what industry has long stressed: clarity, coherence and predictability are essential for investment. Clear, harmonized rules are not a luxury — they are prerequisites for maintaining any industrial presence in Europe. This is where REACH must be seen for what it is: the world’s most comprehensive piece of legislation governing chemicals. Yet the real issues lie in implementation. We therefore call on policymakers to focus on smarter, more efficient implementation without reopening the legal text. Industry is facing too many headwinds already. Simplification can be achieved without weakening standards, but this requires a clear political choice. We call on European policymakers to restore the investment and profitability of our industry for Europe. Only then will the transition to climate neutrality, circularity, and safe and sustainable chemicals be possible, while keeping our industrial base in Europe. > Our industry is an enabler of the transition to a climate-neutral and circular > future, but we need support for technologies that will define that future. In this context, the ETS must urgently evolve. With enabling conditions still missing, like a market for low-carbon products, energy and carbon infrastructures, access to cost-competitive low-carbon energy sources, ETS costs risk incentivizing closures rather than investment in decarbonization. This may reduce emissions inside the EU, but it does not decarbonize European consumption because production shifts abroad. This is what is known as carbon leakage, and this is not how EU climate policy intends to reach climate neutrality. The system needs urgent repair to avoid serious consequences for Europe’s industrial fabric and strategic autonomy, with no climate benefit. These shortcomings must be addressed well before 2030, including a way to neutralize ETS costs while industry works toward decarbonization. Our industry is an enabler of the transition to a climate-neutral and circular future, but we need support for technologies that will define that future. Europe must ensure that chemical recycling, carbon capture and utilization, and bio-based feedstocks are not only invented here, but also fully scaled here. Complex permitting, fragmented rules and insufficient funding are slowing us down while other regions race ahead. Decarbonization cannot be built on imported technology — it must be built on a strong EU industrial presence. Critically, we must stimulate markets for sustainable products that come with an unavoidable ‘green premium’. If Europe wants low-carbon and circular materials, then fiscal, financial and regulatory policy recipes must support their uptake — with minimum recycled or bio-based content, new value chain mobilizing schemes and the right dose of ‘European preference’. If we create these markets but fail to ensure that European producers capture a fair share, we will simply create new opportunities for imports rather than European jobs. > If Europe wants a strong, innovative resilient chemical industry in 2030 and > beyond, the decisions must be made today. The window is closing fast. The Critical Chemicals Alliance offers a path forward. Its primary goal will be to tackle key issues facing the chemical sector, such as risks of closures and trade challenges, and to support modernization and investments in critical productions. It will ultimately enable the chemical industry to remain resilient in the face of geopolitical threats, reinforcing Europe’s strategic autonomy. But let us be honest: time is no longer on our side. Europe’s chemical industry is the foundation of countless supply chains — from clean energy to semiconductors, from health to mobility. If we allow this foundation to erode, every other strategic ambition becomes more fragile. If you weren’t already alarmed — you should be. This is a wake-up call. Not for tomorrow, for now. Energy support, enforceable rules, smart regulation, strategic trade policies and demand-driven sustainability are not optional. They are the conditions for survival. If Europe wants a strong, innovative resilient chemical industry in 2030 and beyond, the decisions must be made today. The window is closing fast. -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is CEFIC- The European Chemical Industry Council  * The ultimate controlling entity is CEFIC- The European Chemical Industry Council  More information here.

Belarus released more than 100 political prisoners, including Nobel Peace Prize winner Ales Bialiatski and activist Maria Kolesnikova, multiple media outlets reported on Saturday. Belarus released a total of 123 prisoners following talks between authoritarian President Alexander Lukashenko and U.S. President Donald Trump’s special envoy for Belarus John Coale, BBC reported. The U.S. reportedly agreed to lift sanctions on potash, a key fertilizer component and an important export for Belarus, a historical ally of Russia. Kolesnikova was sentenced four years ago to a long prison term after being convicted of attempting to seize power illegally. 

LONDON — The British government is working to give its trade chief new powers to move faster in imposing higher tariffs on imports, as it faces pressure from Brussels and Washington to combat Chinese industrial overcapacity. Under new rules drawn up by British officials, Trade Secretary Peter Kyle will have the power to direct the Trade Remedies Authority (TRA) to launch investigations and give ministers options to set higher duty levels to protect domestic businesses. The trade watchdog will be required to set out the results of anti-dumping and anti-subsidy investigations within a year, better monitor trade distortions and streamline processes for businesses to prompt trade probes. The U.K. is in negotiations with the U.S. and the EU to forge a steel alliance to counter Chinese overcapacity as the bloc works to introduce its own updated safeguards regime. The EU is the U.K.’s largest market and Brussels is creating a new steel protection regime that is set to slash Britain’s tariff-free export quotas and place 50 percent duties on any in excess. The government said its directive to the TRA will align the U.K. with similar powers in the EU and Australia, and follow World Trade Organization rules. It is set out in a Strategic Steer to the watchdog and will be introduced as part of the finance bill due to be wrapped up in the spring. “We are strengthening the U.K.’s system for tackling unfair trade to give our producers and manufacturers — especially SMEs who have less capacity and capability — the backing they need to grow and compete,” Business and Trade Secretary Peter Kyle said in a statement. “By streamlining processes and aligning our framework with international peers, we are ensuring U.K. industry has the tools to protect jobs, attract investment and thrive in a changing global economy,” Kyle added. These moves come after the government said on Wednesday that its Steel Strategy, which plots the future of the industry in Britain and new trade protections for the sector, will be delayed until next year. The Trump administration has been concerned about the U.K.’s steps to counter China’s steel overcapacity and refused to lower further a 25 percent tariff carve-out for Britain’s steel and aluminum exports from the White House’s 50 percent global duties on the metals. Trade Secretary Kyle discussed lowering the Trump administration’s tariffs on U.K. steel with senior U.S. Cabinet members in Washington on Wednesday.  “We are very much on the case of trying to sort out precisely where we land with the EU safeguard,” Trade Minister Chris Bryant told parliament Thursday, after meeting with EU Trade Commissioner Maroš Šefčovič on Wednesday for negotiations. “We will do everything we can to make sure that we have a strong and prosperous steel sector across the whole of the U.K.,” Bryant said. The TRA has also launched a new public-facing Import Trends Monitor tool to help firms detect surges in imports that could harm their business and provide evidence that could prompt an investigation by the watchdog. “We welcome the government’s strategic steer, which marks a significant milestone in our shared goal to make the U.K.’s trade remedies regime more agile, accessible and assertive, as well as providing greater accountability,” said the TRA’s Co-Chief Executives Jessica Blakely and Carmen Suarez. Sophie Inge and Jon Stone contributed reporting.

BRUSSELS — Britain’s top Europe minister defended a decision to keep the U.K. out of the EU’s customs union — despite sounding bullish on a speedy reset of ties with the bloc in the first half of 2026. Speaking to POLITICO in Brussels where he was attending talks with Maroš Šefčovič, the EU trade commissioner, Nick Thomas-Symonds said a non-binding British parliamentary vote on Tuesday on rejoining the tariff-free union — pushed by the Liberal Democrats, but supported by more than a dozen Labour MPs — risked reviving bitter arguments about Brexit. Thomas-Symonds described the gambit by the Lib Dems — which had the backing of one of Labour’s most senior backbenchers, Meg Hillier — as “Brexit Redux.” And he accused Ed Davey, the Lib Dem leader, of wanting “to go back to the arguments of the past.” The Lib Dems have drawn support from disillusioned Labour voters, partly inspired by the party’s more forthright position on moving closer to the EU. But Thomas-Symonds defended Labour’s manifesto commitment to remain outside the single market and the customs union. “The strategy that I and the government have been pursuing is based on our mandate from the general election of 2024, that we would not go back to freedom of movement, we would not go back to the customs union or the single market,” the British minister for European Union relations said. Thomas-Symonds said this remained a “forward-looking, ruthlessly pragmatic approach” that is “rooted in the challenges that Britain has in the mid 2020s.” He pointed out that post-Brexit Britain outside of the customs union has signed trade deals with India and the United States, demonstrating the “advantages of the negotiating freedoms Britain has outside the EU.” ‘GET ON WITH IT’ Speaking to POLITICO’s Anne McElvoy for the “Politics at Sam and Anne’s” podcast, out on Thursday, Thomas-Symonds was optimistic that a grand “reset” of U.K.-EU relations would progress more quickly in the new year. The two sides are trying to make headway on a host of areas including a youth mobility scheme and easing post-Brexit restrictions on food and drink exports. “I think if you look at the balance of the package and what I’m talking about in terms of the objective on the food and drink agreement, I think you can see a general timetable across this whole package,” he said. Pressed on whether this could happen in the first half of 2026,  the U.K. minister sounded upbeat: “I think the message from both of us to our teams will be to get on with it.”  The Brussels visit comes after talks over Britain’s potential entry into a major EU defense program known as SAFE broke down amid disagreement over how much money the U.K. would pay for access to the loans-for-arms scheme. The program is aimed at re-arming Europe more speedily to face the threat from Russia. Asked if the collapse of those talks showed the U.K. had miscalculated its ability to gain support in a crucial area of re-connection, Thomas-Symonds replied: “We do always impose a very strict value for money. What we would not do is contribute at a level that isn’t in our national interest.” The issued had “not affected the forward momentum in terms of the rest of the negotiation,” he stressed. YOUTH MOBILITY STANDOFF Thomas-Symonds is a close ally of Prime Minister Keir Starmer and has emboldened the under-fire British leader to foreground his pro-Europe credentials. The minister for European relations suggested his own elevation in the British government — he will now attend Cabinet on a permanent basis — was a sign of Starmer’s intent to focus on closer relations with Europe and tap into regret over a post-Brexit loss of business opportunities to the U.K. Fleshing out the details of a “youth mobility” scheme — which would allow young people from the EU and the U.K. to spend time studying, traveling, or working in each other’s countries — has been an insistent demand of EU countries, notably Germany and the Netherlands. Yet progress has foundered over how to prevent the scheme being regarded  as a back-door for immigration to the U.K. — and how exactly any restrictions on numbers might be set and implemented. Speaking to POLITICO, Thomas-Symonds hinted at British impatience to proceed with the program, while stressing: “It has to be capped, time-limited, and  it’ll be a visa-operated scheme. “Those are really important features, but I sometimes think on this you can end up having very dry discussion about the design when actually this is a real opportunity for young Brits and for young Europeans to live, work, study, enjoy other cultures.” The British government is sensitive to the charge that the main beneficiaries of the scheme will be students or better-off youngsters. “I’m actually really excited about this,” Thomas-Symonds said, citing his own working-class background and adding that he would have benefited from a chance to spend time abroad as a young man “And the thing that strikes me as well is making sure this is accessible to people from all different backgrounds,” he said. Details however still appear contentious: The EU’s position remains that the scheme should not be capped but should have a break clause in the event of a surge in numbers. Berlin in particular has been reluctant to accept the Starmer government’s worries that the arrangement might be seen as adding to U.K. immigration figures, arguing that British students who are outside many previous exchange programs would also be net beneficiaries.  Thomas-Symonds did not deny a stand-off, saying: “When there are ongoing talks about particular issues, I very much respect the confidentiality and trust on the ongoing talks.”  Britain’s most senior foreign minister, Yvette Cooper, on Wednesday backed a hard cap on the number of people coming in under a youth mobility scheme. She told POLITICO in a separate interview that such a scheme needs to be “balanced.” “The UK-EU relationship is really important and is being reset, and we’re seeing cooperation around a whole series of different things,” she said. We also, at the same time, need to make sure that issues around migration are always properly managed and controlled.” A U.K. official later clarified that Cooper is keen to see an overall cap on numbers. BOOZY GIFT As negotiations move from the technical to the political level this week, Thomas-Symonds sketched out plans for a fresh Britain-EU summit in Brussels when the time is right. “In terms of the date, I just want to make sure that we have made sufficient progress, to demonstrate that progress in a summit,” Nick Thomas-Symonds said. “I think that the original [post-Brexit] Trade and Cooperation Agreement did not cover services in the way that it should have done,” he added. “We want to move forward on things like mutual recognition of professional qualifications.” Thomas-Symonds, one of the government’s most ardent pro-Europeans, meanwhile told POLITICO he had forged a good relationship with “Maroš” (Šefčovič) – and had even brought him a Christmas present of a bottle of House of Commons whisky. “So there’s no doubt that there is that trajectory of closer U.K.-EU cooperation,” he quipped. Dan Bloom and Esther Webber contributed reporting.

European industry is facing a “life or death” moment, says French President Emmanuel Macron, squeezed between an ultra-competitive China and a protectionist America — and Beijing should ride to its rescue with long overdue foreign investment. “The Chinese have to do in Europe what the Europeans did 25 years ago by investing in China,” Macron told the Les Echos financial newspaper upon returning from his fourth official trip to Beijing since 2018. The continent’s trade deficit with China was €306 billion in 2024, on some €213 billion in exports against €519 billion in imports. “I am trying to explain to the Chinese that their trade surplus is untenable and that they are killing their own customers, mainly by not importing much from us,” the French leader said. A similar imbalance exists between Europe’s €232 billion investment stock in China — the total value of accumulated portfolio investments and FDI — and China’s €65 billion in Europe, according to data for 2023. “We recognize that they are very good in some areas. But we can’t be constantly importing,” Macron said. “Chinese businesses have to come to Europe, just like EDF and Airbus previously went to China, and create value and opportunities for Europe.” He added, however, that “Chinese investments in Europe must not be predatory, by which I mean in pursuit of hegemony and creating dependencies.” France takes up the 2026 presidency of the G7 group of major advanced economies on Jan. 1 and will host the G7 summit in Evian, France, in June. Bloomberg reported last month that Macron is considering inviting Chinese President Xi Jinping to the summit and intends to use its presidency to restore the G7 to its former global standing. Macron warned in the Les Echos interview that Europe might be forced to slap customs duties on Chinese imports, as the U.S. has done under Donald Trump, and accused Beijing of “hitting the heart of Europe’s innovation and industrial model.” But rather than more confrontation, the French president proposed a truce with Beijing — “the mutual dismantling of our aggressive policies, such as restrictions on the export of semiconductor machines on the European side and limitations on the export of rare earths on the Chinese side.”

The European Commission has lost access to its control panel for buying and tracking ads on Elon Musk’s X — after fining the social media platform €120 million for violating EU transparency rules. “Your ad account has been terminated,” X’s head of product, Nikita Bier, wrote on the platform early Sunday. Bier accused the EU executive of trying to amplify its own social media post about the fine on X by trying “to take advantage of an exploit in our Ad Composer — to post a link that deceives users into thinking it’s a video and to artificially increase its reach.” The Commission fined X on Thursday for breaching the EU’s rules under the Digital Services Act (DSA), which aims to limit the spread of illegal content. The breaches included a lack of transparency around X’s advertising library and the company’s decision to change its trademark blue checkmark from a means of verification to a “deceptive” paid feature. “The irony of your announcement,” Bier said. “X believes everyone should have an equal voice on our platform. However, it seems you believe that the rules should not apply to your account.” Trump administration has criticized the DSA and the Digital Markets Act, which prevent large online platforms, such as Google, Amazon and Meta, from overextending their online empires. The White House has accused the rules of discriminating against U.S. companies, and the fine will likely amplify transatlantic trade tensions. U.S. Secretary of Commerce Howard Lutnick has already threatened to keep 50 percent tariffs on European exports of steel and aluminum unless the EU loosens its digital rules. U.S. Vice President JD Vance blasted Brussels’ action, describing the fine as a response for “not engaging in censorship” — a notion the Commission has dismissed. “The DSA is having not to do with censorship,” said the EU’s tech czar, Henna Virkkunen, told reporters on Thursday. “This decision is about the transparency of X.”

EU climate chief Wopke Hoekstra thinks reports of the death of Europe’s green agenda have been greatly exaggerated. “There’s always a lot of talk about backlash,” Hoekstra told POLITICO’s Sustainable Future Summit Tuesday. “That is, I think, one of the big misconceptions.” The EU’s new climate goal for 2040, agreed by ministers last month, “is actually an acceleration, rather than a downgrade, of what we are having today,” he said. The EU’s approach to its environmental and climate rules has been placed under extreme pressure from a combined pushback from far right parties, heavy industry and some leading members of Hoekstra’s own center right European People’s Party. That has led to the scrapping or weakening of some existing standards and made setting the 2040 target a brutal political fight. But Hoekstra said the realignment of some green policies was not about resiling from Europe’s environmental ambitions. “We’ll need to find a recipe — and I’ve been saying that over and over again — where we really make sure that climate, competitiveness and independence are being brought together. That in the end, is the winning formula,” he said. Hoekstra also pushed back on criticism by countries whose exports will be hit by the EU’s carbon border tax. This was a major feature of the recent COP30 climate negotiations, with large emerging economies like South Africa, India and China expressing concern about a measure they believe unfairly disadvantages their industries. Hoekstra dismissed that griping as a way to gain advantage in the course of the COP30 talks. “It is a tool that is being used, as quite often is the case in diplomacy,” he said. What he had heard “behind-closed-doors,” he said, was a completely different story. “Those who might have expressed their concerns publicly are not only acknowledging inside of a room that actually the effects are not that large, they’re actually even saying that it helps them to have a different type of conversation,” he said.

BRUSSELS — The European Union has approved a proposal to curb trade benefits for developing countries that refuse to take back migrants whose stay in the bloc has been denied. Low-tariff access to the EU’s market will be reviewed in the context of “the readmission of that country’s own nationals” who have been identified as “irregular migrants to the Union,” a document seen by POLITICO confirms. Negotiators from the Council of the EU, the European Parliament and the European Commission agreed to the draft text late Monday night. The push to link trade measures to migration policy comes amid major advances by far-right parties across Europe and calls for governments to get tougher on enforcing returns. Currently, only a small share of those eligible for removal from the EU are actually deported — many because their home countries refuse to cooperate. “In case of serious and systematic shortcomings related to the international obligation to readmit a beneficiary country’s own nationals, the preferential arrangements … may be withdrawn temporarily, in respect of all or of certain products originating in that beneficiary country, where the Commission considers that an insufficient level of cooperation on readmission persists,” it reads. The readmission clause will be applied with more or less stringent conditions depending on a country’s development level, the document also says. The measures, which would only be invoked after dialog with countries, are being included in an overhaul of the so-called Generalized Scheme of Preferences, a 50-year old program that enables poorer countries to export goods to EU countries at lower tariff rates. The review of the program, which has been under negotiation for over three years, is designed to help these nations build their economies and is tied to the implementation of human rights, labor and environmental reforms. However, the issue of cheap rice imports from Pakistan or Bangladesh threatened to collapse the talks before the eventual agreement on Monday, amid concerns from EU producers like Spain and Italy that want to ensure their own farmers are not outcompeted. EU countries have long been considering the idea of using trade, development and visa policies to ensure third countries agree to take back failed migrants, amid growing public discontent that has driven victories for far-right parties at the ballot box. However, the proposals had faced opposition from the Parliament, as well as the Commission and a handful of capitals that feared this would upend relations with key partner countries. Denmark’s center-left government set its sights on migration as a key issue for its presidency, which ends on Dec. 31. Justice and home affairs ministers will meet next Monday to discuss ways to ensure more people leave the EU after their applications to stay are rejected, including through so-called return hubs in third countries.

High energy prices, risks on CBAM enforcement and promotion of lead markets, as well as increasing carbon costs are hampering domestic and export competitiveness with non-EU producers. The cement industry is fundamental to Europe’s construction value chain, which represents about 9 percent of the EU’s GDP. Its hard-to-abate production processes are also currently responsible for 4 percent of EU emissions, and it is investing heavily in measures aimed at achieving full climate neutrality by 2050, in line with the European Green Deal. Marcel Cobuz, CEO, TITAN Group  “We should take a longer view and ensure that the cement industry in EU stays competitive domestically and its export market shares are maintained.” However, the industry’s efforts to comply with EU environmental regulations, along with other factors, make it less competitive than more carbon-intensive producers from outside Europe. Industry body Cement Europe recently stated that, “without a competitive business model, the very viability of the cement industry and its prospects for industrial decarbonization are at risk.” Marcel Cobuz, member of the Board of the Global Cement and Concrete Association and CEO of TITAN Group, one of Europe’s leading producers, spoke with POLITICO Studio about the vital need for a clear policy partnership with Brussels to establish a predictable regulatory and financing framework to match the industry’s decarbonization ambitions and investment efforts to stay competitive in the long-term. POLITICO Studio: Why is the cement industry important to the EU economy?  Marcel Cobuz: Just look around and you will see how important it is. Cement helped to build the homes that we live in and the hospitals that care for us. It’s critical for our transport and energy infrastructure, for defense and increasingly for the physical assets supporting the digital economy. There are more than 200 cement plants across Europe, supporting nearby communities with high-quality jobs. The cement industry is also key to the wider construction industry, which employs 14.5 million people across the EU. At the same time, cement manufacturers from nine countries compete in the international export markets. PS: What differentiates Titan within the industry?  MC: We have very strong European roots, with a presence in 10 European countries. Sustainability is very much part of our DNA, so decarbonizing profitably is a key objective for us. We’ve reduced our CO2 footprint by nearly 25 percent since 1990, and we recently announced that we are targeting a similar reduction by 2030 compared to 2020. We are picking up pace in reducing emissions both by using conventional methods, like the use of alternative sources of low-carbon energy and raw materials, and advanced technologies. TITAN/photo© Nikos Daniilidis We have a large plant in Europe where we are exploring building one of the largest carbon capture projects on the continent, with support from the Innovation Fund, capturing close to two million tons of CO2 and producing close to three million tons of zero-carbon cement for the benefit of all European markets. On top of that, we have a corporate venture capital fund, which partners with startups from Europe to produce the materials of tomorrow with  very low or zero carbon. That will help not only TITAN but the whole industry to accelerate its way towards the use of new high-performance materials with a smaller carbon footprint. PS: What are the main challenges for the EU cement industry today?  MC: Several factors are making us less competitive than companies from outside the EU. Firstly, Europe is an expensive place when it comes to energy prices. Since 2021, prices have risen by close to 65 percent, and this has a huge impact on cement producers, 60 percent of whose costs are energy-related. And this level of costs is two to three times higher than those of our neighbors. We also face regulatory complexity compared to our outside competitors, and the cost of compliance is high. The EU Emissions Trading System (ETS) cost for the cement sector is estimated at €97 billion to €162 billion between 2023 and 2034. Then there is the need for low-carbon products to be promoted ― uptake is still at a very low level, which leads to an investment risk around new decarbonization technologies. > We should take a longer view and ensure that the cement industry in the EU > stays competitive domestically and its export market shares are maintained.” All in all, the playing field is far from level. Imports of cement into the EU have increased by 500 percent since 2016. Exports have halved ― a loss of value of one billion euros. The industry is reducing its cost to manufacture and to replace fossil fuels, using the waste of other industries, digitalizing its operations, and premiumizing its offers. But this is not always enough. Friendly policies and the predictability of a regulatory framework should accompany the effort. PS: In January 2026, the Carbon Border Adjustment Mechanism will be fully implemented, aimed at ensuring that importers pay the same carbon price as domestic producers. Will this not help to level the playing field? MC: This move is crucial, and it can help in dealing with the increasing carbon cost. However, I believe we already see a couple of challenges regarding the CBAM. One is around self-declaration: importers declare the carbon footprint of their materials, so how do we avoid errors or misrepresentations? In time there should be audits of the importers’ industrial installations and co-operation with the authorities at source to ensure the data flow is accurate and constant. It really needs to be watertight, and the authorities need to be fully mobilized to make sure the real cost of carbon is charged to the importers. Also, and very importantly, we need to ensure that CBAM does not apply to exports from the EU to third countries, as carbon costs are increasingly a major factor making us uncompetitive outside the EU, in markets where we were present for more than 20 years. > CBAM really needs to be watertight, and the authorities need to be fully > mobilized to make sure the real cost of carbon is charged to the importers.” PS: In what ways can the EU support the European cement industry and help it to be more competitive? MC: By simplifying legislation and making it more predictable so we can plan our investments for the long term. More specifically, I’m talking about the revamping of the ETS, which in its current form implies a phase-down of CO2 rights over the next decade. First, we should take a longer view and ensure that the cement industry stays competitive and its export market shares are maintained, so a policy of more for longer should accompany the new ETS. > In export markets, the policy needs to ensure a level playing field for > European suppliers competing in international destination markets, through a > system of free allowances or CBAM certificates, which will enable exports to > continue.” We should look at it as a way of funding decarbonization. We could front-load part of ETS revenues in a fund that would support the development of technologies such as low-carbon materials development and CCS. The roll-out of Infrastructure for carbon capture projects such as transport or storage should also be accelerated, and the uptake of low-carbon products should be incentivized. More specifically on export markets, the policy needs to ensure a level playing field for European suppliers competing in international destination markets, through a system of free allowances or CBAM certificates, which will enable exports to continue. PS: Are you optimistic about the future of your industry in Europe?  MC: I think with the current system of phasing out CO2 rights, and if the CBAM is not watertight, and if energy prices remain several times higher than in neighboring countries, and if investment costs, particularly for innovating new technologies, are not going to be financed through ETS revenues, then there is an existential risk for at least part of the industry. Having said that, I’m optimistic that, working together with the European Commission we can identify the right policy making solutions to ensure our viability as a strategic industry for Europe. And if we are successful, it will benefit everyone in Europe, not least by guaranteeing more high-quality jobs and affordable and more energy-efficient materials for housing ― and a more sustainable and durable infrastructure in the decades ahead. -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is Titan Group * The advertisement is linked to policy advocacy around industrial competitiveness, carbon pricing, and decarbonization in the EU cement and construction sectors, including the EU’s CBAM legislation, the Green Deal, and the proposed revision of the ETS. More information here.

BRUSSELS — Europe’s most energy-intensive industries are worried the European Union’s carbon border tax will go too soft on heavily polluting goods imported from China, Brazil and the United States — undermining the whole purpose of the measure. From the start of next year, Brussels will charge a fee on goods like cement, iron, steel, aluminum and fertilizer imported from countries with weaker emissions standards than the EU’s. The point of the law, known as the Carbon Border Adjustment Mechanism, is to make sure dirtier imports don’t have an unfair advantage over EU-made products, which are charged around €80 for every ton of carbon dioxide they emit. One of the main conundrums for the EU is how to calculate the carbon footprint of imports when the producers don’t give precise emissions data. According to draft EU laws obtained by POLITICO, the European Commission is considering using default formulas that EU companies say are far too generous. Two documents in particular have raised eyebrows. One contains draft benchmarks to assess the carbon footprint of imported CBAM goods, while the second — an Excel sheet seen by POLITICO — shows default CO2 emissions values for the production of these products in foreign countries. These documents are still subject to change. National experts from EU countries discussed the controversial texts last Wednesday during a closed-door meeting, and asked the Commission to rework them before they can be adopted. That’s expected to happen over the next few weeks, according to two people with knowledge of the talks. Multiple industry representatives told POLITICO that the proposed estimated carbon footprint values are too low for a number of countries, which risks undermining the efficiency of the CBAM. For example, some steel products from China, Brazil and the United States have much lower assumed emissions than equivalent products made in the EU, according to the tables. Ola Hansén, public affairs director of the green steel manufacturer Stegra, said he had been “surprised” by the draft default values that have been circulating, because they suggest that CO2 emissions for some steel production routes in the EU were higher than in China, which seemed “odd.” “Our recommendation would be [to] adjust the values, but go ahead with the [CBAM] framework and then improve it over time,” he said. Antoine Hoxha, director general of industry association Fertilizers Europe, also said he found the proposed default values “quite low” for certain elements, like urea, used to manufacture fertilizers. “The result is not exactly what we would have thought,” he said, adding there is “room for improvement.” But he also noted that the Commission is trying “to do a good job but they are extremely overwhelmed … It’s a lot of work in a very short period of time.” Multiple industry representatives told POLITICO that the proposed estimated carbon footprint values are too low for a number of countries, which risks undermining the efficiency of the CBAM. | Photo by VCG via Getty Images While a weak CBAM would be bad for many emissions-intensive, trade-exposed industries in the EU, it’s likely to please sectors relying on cheap imports of CBAM goods — such as European farmers that import fertilizer — as well as EU trade partners that have complained the measure is a barrier to global free trade. The European Commission declined to comment. DEFAULT VERSUS REAL EMISSIONS Getting this data right is crucial to ensure the mechanism works and encourages companies to lower their emissions to pay a lower CBAM fee. “Inconsistencies in the figures of default values and benchmarks would dilute the incentive for cleaner production processes and allow high-emission imports to enter the EU market with insufficient carbon costs,” said one CBAM industry representative, granted anonymity to discuss the sensitive talks. “This could result in a CBAM that is not only significantly less effective but most likely counterproductive.” The default values for CO2 emissions are like a stick. When the legislation was designed, they were expected to be set quite high to “punish importers that are not providing real emission data,” and encourage companies to report their actual emissions to pay a lower CBAM fee, said Leon de Graaf, acting president of the Business for CBAM Coalition. But if these default values are too low then importers no longer have any incentive to provide their real emissions data. They risk making the CBAM less effective because it allows imported goods to appear cleaner than they really are, he said. The Commission is under pressure to adopt these EU acts quickly as they’re needed to set the last technical details for the implementation of the CBAM, which applies from Jan. 1. However, de Graaf warned against rushing that process. On the one hand, importers “needed clarity yesterday” because they are currently agreeing import deals for next year and at the moment “cannot calculate what their CBAM cost will be,” he said. But European importers are worried too, because once adopted the default emission values will apply for the next two years, the draft documents suggest. The CBAM regulation states that the default values “shall be revised periodically.” “It means that if they are wrong now … they will hurt certain EU producers for at least two years,” de Graaf said.