Steel industry: Vital for Europe's economy

Steel industry: Vital for Europe's economy

The steel industry employs hundreds of thousands of Europeans and is a world leader in some steel products. It generated 1.3% of the EU’s GDP in 2015, and supported 328,000 jobs. That’s why the EU is prepared to act decisively to defend that sector in the face of mounting global trade tensions.

It’s part of the backbone of Europe’s economy. Hot-rolled steel is used in construction, shipbuilding, gas containers, pressure vessels and energy pipelines. Steel is also a vital material for the auto sector and all industries which support it. That means millions of European jobs are related indirectly to the steel industry.

Steel plants in Europe have gotten smarter - innovating and modernising to boost efficiency and remain competitive. But excess production and subsidies in third countries such as China have driven down prices. World steel producers have been discussing how to tackle the issue, and the European Union believes grievances should be dealt with at the multilateral level, for example at the World Trade Organization.

Regarding threatened US tariffs against steel and aluminium imports, EU Trade Commissioner Cecilia Malmström called them “a highly unfortunate unilateral action, which goes against agreed international rules.’’ The EU is calling for a full exemption and further talks to reduce any trade frictions with the United States.

“We consider these tariffs as not according to WTO rules; they are pure protectionism,” European Trade Commissioner Cecilia Malmström said. The EU was “under no circumstances negotiating anything under pressure and under threats.”

At the same time, the EU shares many of the US and Japanese concerns about steel overcapacity, with a three-way discussion on that issue in Brussels in March. The EU has imposed numerous anti-dumping measures against Chinese steel, and the European Commission has been closely examining the possibility of launching WTO cases to defend the EU’s steel sector.