Summary
- European industry needs to decarbonise, or it risks falling behind in green technology while countries like China race ahead.
- The EU has invested in clean technology and decarbonising heavy industry, but current spending is insufficient for Europe to remain competitive and meet its climate targets.
- The European Commission has proposed increasing funding for green industry in the EU’s next budget, the “multiannual financial framework”, to be approved in 2027 at the latest.
- Member states are divided over funding sources and priorities. The “frugal” states argue for no increase in overall EU spending, while the “friends of cohesion” want more money for agriculture and development. All states agree that defence and competitiveness are key priorities.
- To secure broad agreement, the budget should be underpinned by efficient and well-governed policy. Investing in green industry now can generate long-term benefits for Europe’s security and economy—not least for the frugal states of northern Europe.
About the author:
Mats Engström is a senior policy fellow and an analyst and writer based in Stockholm.