A Belgian former senior EU official has played down the potential loss of Europe's heavy industry, suggesting that the continent's deindustrialisation should even be welcomed if it is driven by natural market forces.
In an interview with l'Echo, Pierre Régibeau – the recently retired Chief Competition Economist at the European Commission's Directorate-General for Competition and the former right-hand man of renowned EU antitrust chief Margrethe Vestager – also claimed that implementing protectionist measures to safeguard Europe's industrial base would be "stupid" and would ultimately "cost taxpayers very dearly".
"If [heavy industry] disappears, so be it. It has to. What is the point of producing basic steel here if we can buy it three times cheaper in Indonesia?... If the imports are even cheaper, I don't see what the problem is."
When it was suggested that the erosion of Europe's industry could lead to significant job losses, Régibeau remained undeterred: "If we followed this reasoning, we would still have 40,000 miners in Liège. Let's not delude ourselves. Economies are flexible, they evolve. The shocks are absorbed."
'Pure alarmism'
Régibeau's remarks contrast sharply with those of industry leaders and other EU officials, many of whom have issued repeated and explicit warnings about the dangers currently facing Europe's industry.
One study published in June by the Federation of Belgian Companies (FEB) estimated that 80% of Belgian companies are paying two-and-a-half times more for energy than they were at the beginning of 2022. It cautioned that the high cost of energy is rendering businesses in Belgium increasingly uncompetitive relative to those in the US.
"The competition with the United States is tough," FEB Chief Economist and report co-author Edward Roosens told l'Echo. "There the gas price is €12 per megawatt-hour (MWh), compared to more than €30 per MWh with us."
Such concerns were echoed earlier this year by European Internal Market Commissioner Thierry Breton, who noted that "high energy prices in Europe will continue to affect our fellow citizens, but also entire industrial supply chains and [small and medium-sized businesses]". He added: "At the same time, China, the US and other countries are trying – not without success – to attract our industrial capacities."
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But the former EU official dismissed such warnings as "pure alarmism" propagated by industry leaders. He posited that such doom-mongering is a ploy to persuade government officials to enact protectionist legislation "for their own self-interest".
Régibeau also claimed that the repeated warnings by EU officials and industry leaders of the dangers posed to the European economy by the Inflation Reduction Act (IRA) were "exaggerated" and issued a scathing criticism of the American legislators who devised it: "The total amount of subsidies [provided by the IRA] is not so high, especially if we compare it with state aid in Europe."
He continued: "This is not to say that the IRA is perfect. On the contrary, as an economic policy it is pitiful. It seems to have been written on a beer coaster during a drunken evening. The money is spent incredibly inefficiently." He insisted that "Protectionism is not the solution", warning that this will simply "create a stupid race for subsidies that would cost taxpayers very dearly."
"Except for safety reasons, why manufacture wind turbines in Europe when you can buy them twice as cheap elsewhere? Europe should thank these countries for this gift."
